child age 25 (in a wheelchair) and dependency ?

[dan doshan]

Client has a 25yr old daughter who lives with her. She is in a wheelchair. So I looked up dependency and TTB page 3-13 says any age if permanently & totally disabled and see page 3-15. On that page it says a person is permanently and totally disabled if he or she CANNOT engage in any substantial gainful activity because of a physical or mental condition that a doctor has determined has lasted or can be expected to last continuously for at least a year or can be expected to lead to death.

The 25yr old daughter does work and made more than $4,000. Mom (my client) has to take her to work. And also had the expenses of a Car chair for van $3850 and also having a contractor put in a wheel chair ramp at the home.

1st. Is the daughter a dependent? She works, so does that mean she is engaged in a substantial gainful activity?

2nd... Can the Mom claim any of the above expenses?

Might depend on how much she made and just how disabled she is. However, based on the post, if I was doing the return, I would consider the child a qualifying child of Mom. It seems reasonable clear to me, again based on the information provided in the post.

[TaxGuyBill]

This is very interesting. Has there been a Tax Court ruling or CCA on this that can be found? I would think the IRS would certainly stick with their rule about income unless overruled by something.

Are you referring to the part the the kid can be a Qualifying Child? That is right in the Code: §152(c)(3). A Qualifying Child does not have in income limit.

https://www.law.cornell.edu/uscode/text/26/152#c_3

https://www.irs.gov/publications/p501/ar02.html#en_US_2015_publink1000220890

A further clarification in my statement would be that the IRS viewpoints of "substantial gainful activity" MIGHT be different than the SSA's definition. Unless I found something that indicates the IRS viewpoint IS different (such as Tax Court cases or CCA), I would go with the SSA's criteria.

Wow, some people really like to insert wording in the laws and regs that isn't there. The law doesn't say anything about what a person actually earned, it's whether they COULD engage in substantial activity. Since when does being in a wheelchair prevent someone from working full time? Haven't we all paid millions and billions of dollars (public and private) under ADA regs precisely to make it possible for people in wheelchairs to travel to and from work?

Yes, but we don't know anything else about the situation. Maybe $4000-$5000 of income is all this kid would be able to do. The fact that the Mom drives the Kid to work might indicate that there is more involved. The OP, client, and perhaps a Medical professional would need to make that determination.

[Rapid Robert]

Wow, some people really like to insert wording in the laws and regs that isn't there. The law doesn't say anything about what a person actually earned, it's whether they COULD engage in substantial activity. Since when does being in a wheelchair prevent someone from working full time? Haven't we all paid millions and billions of dollars (public and private) under ADA regs precisely to make it possible for people in wheelchairs to travel to and from work?

[Burke]

To qualify as a disabled (to qualify as a Qualifying Child), the rule isn't that the person can't have Gainful Activity. The rule is that the person can't have SUBSTANTIAL Gainful Activity. Having over $4000 of income doesn't necessarily mean it is "substantial gainful activity".

Although the IRS has their own viewpoints, a person needs to earn over $1090 per MONTH (over $13,000 per year) before the Social Security Administration views it as a "Substantial Gainful Activity" (see link). In my opinion, unless there is evidence that the IRS views it differently, I would go with the Social Security Administration's definition of Substantial Gainful Activity.

https://www.ssa.gov/oact/cola/sga.html

https://www.ssa.gov/redbook/eng/defi...lity.htm#&a0=0

This is very interesting. Has there been a Tax Court ruling or CCA on this that can be found? I would think the IRS would certainly stick with their rule about income unless overruled by something.

[TAXNJ]

Answer you found it also

The question that needs to be asked is where does she work? There is an exception for disabled that work for a specific agency and there is research for this that can be found. It would allow the mother to take her as a dependent. Is there a doctor's form filed? If not get one.

You found the answer and will you share the specifics. Never heard that before and sure many would need such information that you say "There is an exception for disabled that work for a specific agency and there is research". Since you found such information will you share your finding for such an exception.

[TAXNJ]

ANSWER you found. What and where do you based that ?

Yes. Mother can claim her daughter even if she made more than 4,000. As long as the daughter does not provided over half of her own support.

What and where do you base that claim? Original Poster & other reply posters research has not found a reference that supports that claim.

Will you provide specifically your findings to share.

[taxea]

The question that needs to be asked is where does she work? There is an exception for disabled that work for a specific agency and there is research for this that can be found. It would allow the mother to take her as a dependent. Is there a doctor's form filed? If not get one.

[TAXNJ]

viewpoints to be shared

To qualify as a disabled (to qualify as a Qualifying Child), the rule isn't that the person can't have Gainful Activity. The rule is that the person can't have SUBSTANTIAL Gainful Activity. Having over $4000 of income doesn't necessarily mean it is "substantial gainful activity".

Although the IRS has their own viewpoints, a person needs to earn over $1090 per MONTH (over $13,000 per year) before the Social Security Administration views it as a "Substantial Gainful Activity" (see link). In my opinion, unless there is evidence that the IRS views it differently, I would go with the Social Security Administration's definition of Substantial Gainful Activity.

https://www.ssa.gov/oact/cola/sga.html

https://www.ssa.gov/redbook/eng/defi...lity.htm#&a0=0

But, now you are referring to the SSA but I think the Original Poster is looking at the other government agency (IRS), so if you can share for the Original Poster what you say "the IRS has their own viewpoints", think that might help toward making a decision.

But you do give information that may help with Social Security for Social Security purposes.

Since there may be more information then what is in the original post by the Original Poster.

[nwtaxlady]

I did find that the medical expenses are deductible! Thanks!

There was an exception for those not claimed on dependents due to income over $4000. She can claim her daughters medical expenses!

[Lion]

But, you want some documentation that the child is permanently and totally disabled. Doctor's affidavit or she's on SS Disability, some independent third-party qualified to certify the extent of the child's disability. If she can document her disabled status, then Age is no longer an issue for Qualifying Child. All other points remain, though, such as not earning more than half her own support.

[nwtaxlady]

Daughter does NOT receive Soc Sec because she is working. Also medical expenses???

I asked the client if the daughter is receiving Social Security disability and she said no. No because she is working. So I perceive that as gainful activity and she does not qualify as a dependent. Just as she does not qualify for Social Security because she is working.

I am still unclear as to if Mom can deduct medical expenses such as braces for her and also the wheelchair ramp and car chair for van etc.

What I have read is the medical expenses must be for a dependent. If someone else knows something different please enlighten me!

[spanel]

Yes. Mother can claim her daughter even if she made more than 4,000. As long as the daughter does not provided over half of her own support.

Under what?

Qualifying Child? Are we saying because the daughter is disabled we overlook the $4000 qualifying relative rule?

Chris

[MANDAN]

Dependent of a disable daughter

Yes. Mother can claim her daughter even if she made more than 4,000. As long as the daughter does not provided over half of her own support.

[TaxGuyBill]

To qualify as a disabled (to qualify as a Qualifying Child), the rule isn't that the person can't have Gainful Activity. The rule is that the person can't have SUBSTANTIAL Gainful Activity. Having over $4000 of income doesn't necessarily mean it is "substantial gainful activity".

Although the IRS has their own viewpoints, a person needs to earn over $1090 per MONTH (over $13,000 per year) before the Social Security Administration views it as a "Substantial Gainful Activity" (see link). In my opinion, unless there is evidence that the IRS views it differently, I would go with the Social Security Administration's definition of Substantial Gainful Activity.

https://www.ssa.gov/oact/cola/sga.html

https://www.ssa.gov/redbook/eng/defi...lity.htm#&a0=0

[spanel]

Great minds think alike

Yep. I missed read it. Sorry

Chris