Filing Status-Dependents

[Bird Legs]

This question was discussed a while back. However, it has arisen again.
Client, single male, girlfriend lives with him. Girlfriend has a child from previous
marriage. Both work, Male is self employed, female is an employee.
The house belongs to the male.
My thinking on this is that the male would file single.
Female, mother, would file single claiming the child as a dependent and possibly
elible for Child Credit.
Does this sound correct?
Thanks

[solomon]

Sounds

Same wayI would do it.

[jainen]

to make my point

>>Same wayI would do it.<<

I might do it differently. It all depends on the numbers (which we can only guess at). Is the gentleman's business maybe not doing so well? Even though he owns the house, when the lady pays the mortgage and utilities she can file as Head of Household.

On the other hand, for support we look at the fair rental value (provided by the owner), not the actual bills (paid by his friend). So even if the lady is signing most of the checks, she might still be a tax dependent of the gentleman. That leads to the classic dilemna we have discussed over and over again on this forum--whether her kid is still a Qualified Child, in which case the exemption is "wasted" since she (as a dependent herself) can not claim another dependent and the QC could not be a Qualified Relative to the homeowner.

Most of this should depend on the facts on the ground, but to the extent you have the flexibility to interpret the numbers for the client's advantage, compare the total family tax with various scenarios. Be sure to consider EIC for low income and AMT for high.

Well, now I think this post is long enough to make my point.