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A different type of EITC question

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    A different type of EITC question

    I know lot of EICT questions lately, but can't quite find the exact answer on this one. OK, Pub 596 gives the four tests for claiming a child for EIC. Notice there is no support test. Also nowhere does it say the child needs to be claimed as an exemption to qualify for EIC. Say the child meets all of the tests but earns 40k and supports themself.

    Now one might ask what is the parent doing claiming the EIC if the child has their own money, but that is not the issue here, could debate that another day, just going by the parameters that the Pub has laid out.

    So here is the question. Cannot split benefits with another person other than a former spouse by signing for 8332. But can the child claim their own exemption, and still let the parents claim EIC provided they meet all of the other tests? Want to point out I am not seeking to engage in some type of gamesmanship with a client, just trying to figure out what is legal according to IRS law. Like I previously stated, the merits and or morality of such a situation is a different topic for another day.

    Can always weigh the legal against the moral, the two are not always synonymous.
    Last edited by Bob McCoy; 03-12-2015, 05:44 PM.

    #2
    Originally posted by Bob McCoy View Post
    can the child claim their own exemption, and still let the parents claim EIC provided they meet all of the other tests?
    Yes.

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      #3
      Thanks for the feedback and the link. I was 99.999999% certain the taxpayer didn't have to claim the child's exemption to still be eligible to claim EIC. But what was creating doubt in my mind, was what if the child claimed their own exemption and did that change anything.

      It gets back to not being able to split benefits, the exception a divorced couple with form 8332. Then I started thinking, in the eyes of the IRS, would the child claiming their own exemption and the parent claiming the EIC be a form of unlawful splitting of benefits.

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