CTC for Non-Dependents

[Snaggletooth]

Gospel According to Jainen

is wise indeed, but inconclusive. I wouldn't mind hearing from him if I could
get a definitive "yes" or "no." Bart had to ask him three times yesterday...

[Bird Legs]

Ctc

Does the Government provided money go the children or to the parents? If to the parents,
then they are the ones completely supporting them and should be entitled to all the tax
benefits, providing the children have lived in the home for at least 12 months.
This is off the top of my head and in no way should be accepted as the gospel according to Jainen.

[Snaggletooth]

A customer of mine attends a church who does not believe in orphan homes.

He has taken in 4 orphans into his own home, is raising them, has adopted one and this year will be adopting the other 3.

In the way I have been taught, none of them qualifies as his dependent. He and his wife are receiving either Social Security, State assistance, or both for each of the 4 children, and as such do not furnish more than 50% of the support. The support test is the only test not met by the parents.

However, for purposes of Child Tax Credit, per TTB 11-3, the support test is somewhat modified. It states under 4) [A child who] "Did not provide over half his or her own support for 2006." This throws a different complexion. Although the over 50% of the childrens' support comes from the government, the children did NOT provide anything toward their own support. The text cross-references "Uniform definition of a child." TTB 3-15.

The qualifications for dependency are listed on TTB 3-15. Again the statement disqualifies a child who does not provide his/her support. So it appears the dependency and child tax credit and inexorably linked.

Does this mean a child can be claimed for dependency and child tax credit if over 50% of the support comes from the government, so long as the child does not furnish over 50% themselves? (Assume the other requirements are met so the question can remain simple and focus on the support issue)

As an added note, the parents are not required to claim the support as income. At least to the best of my understanding.