Grandma - Head of Household

[Unregistered-Kicked out]

Already have Mom and grandaughter (born 10/19/05) living with Grandma the entire year. As previously posted Mom made $9,000 and was not a full time student for enough time, but because of EIC Mom will take daughter as dependent.

NOW can Grandma take head of household on granddaughter who lived there from birth at 10/19/05.... THE ONLY QUESTION IS GRANDMA HOH or NOT!!!!!!!!!!!!

[Unregistered]

Only if daughter doesn't claim granddaughter as dependent, then grandma could file as HofH and claim granddaughter,---if granddaughter claims her child as dependent, then grandma cann't file as H of H. per Notice 2006-86 in IRB 2006-41

[Unregistered]

HOH ok

Yes she can.

[jainen]

can't claim EIC

The baby did not live in the household for more than half the year. Can anyone cite authority for treating her as a qualifying child? QC is defined in Section 152, but new regs haven't been issued. She is a qualifying relative under the old rules only. The grandmother can't claim HoH and the mother can't claim EIC.

[Unregistered]

Jainen

The baby did not live in the household for more than half the year

Rule 8. for EIC
Residency Test
A child who was born or died in 2005 is treated as having lived with you for all of 2005 if your home was the child's home the entire time he or she was alive in 2005.

[Unregistered-confused]

No EIC

Why would not the mother quailfy for EIC? I was to the point where both MOM and Grandma could have had the dependent. We decided on the MOM because she would quailfy for EIC-she made $9000, not full time student for 5 months-Grandma could only qualify for granddaughter, I think. Could we get HOH-agree not for six months, but I also thought birth and death were exceptions, but I could be corrected.

HELP

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From notice 2006-86

Example 1. (i) A child, mother, and grandmother share the same principal place of abode.
(ii) The mother claims the child as a qualifying child for purposes of the earned income credit under Sec.32.
(iii) The child is treaded as the qualifying child of the mother for purposes of the earned income credit. Because the mother claims the child as a qualifying child for purposes of the earned income credit, under Sec. 152©(4)(A), the child may not be treated as the qualifying child of the grandmother for any purpose.
(iv) If, however, the mother does not claim the child as a qualifying child for any purpose, the child may be treated as the qualifying child of the grandmother for purposes of the earned income credit under Sec. 32 as well as head of household filing status under Sec. 2(b), the dependency deduction under Sec. 141, the child tax credit under Sec. 24, the child and dependent care credit under Sec. 21, and the exclusion from dependent care credit under Sec. 129, if applicable, assuming that no other taxpayer claims the child as a qualifying child.

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[Unregistered]

In this particular situation, and assuming no one else lives in the household, either the grandmother or mother can claim this child, because the kid is a qualifying child to the both of them. However, once the decision is made as to who will claim the child, then that taxpayer claims the child for all benefits. Only in the case of separated or divorced parents can the benefits be split. In other words, should the daughter claim the child as a dependent (which she the right to do), then the grandmother cannot file as HoH.

In 2003 and 2004, the grandmother could have claimed HoH with her daughter or granddaughter as a nondependent. However, the Uniform Definition of a Child eliminated that altogether. Therefore, you need to claim a QC or eligible QR in order to take advantage of the HoH filing status.

[♠♠♠♠]

I couldn't have said it better--goes with previous post from notice 2006-86

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