Alaska Permanent Funds

[Jesse]

Three questions regarding these funds:

1) These are called "dividends", but are these funds considered in figuring investment income for the $2,800 limit for EIC?

2) If this is a childs only source of income do they need to file if greater than $850?

3) Do the Gross dividends or the Net dividends get reported on line 21?

[erchess]

I only had time to do a quick search but

If your child received Alaska Permanent Fund dividends and if you are reporting your child's income on your return, then this will affect your EIC and there is a special worksheet you will have to complete. Of course if you received such money it is part of your income but apparently no different in effect than anything you would properly report on line 21. In other words, no it isn't investment income.

I found a statement that you report the amount actually received. I presume that would be the net amount you referred to. However, I assume that there is no other benefit for Federal Tax Purposes to the money taken out of the Gross to reach the Net.

I believe that APF money is considered unearned income for purposes of dependents and their filing requirements.

http://www.apfc.org/alaska/contact.cfm has information for contacting the people who run the Fund. I would think that they could answer all your questions better than I can.

[GIMoe]

Permanent Fund Dividend

Three questions regarding these funds:

1) These are called "dividends", but are these funds considered in figuring investment income for the $2,800 limit for EIC?

2) If this is a childs only source of income do they need to file if greater than $850?

3) Do the Gross dividends or the Net dividends get reported on line 21?

1) No, but if a child received the dividend and it was reported on parents return, then you need to use the Worksheets in Pub 596 to back out childs portion.

2) Yes

3) The amount of the dividend for 2006 is $1106.96 -- this whole amount needs to be reported. You can find more info on this @ http://www.pfd.state.ak.us/taxes/index.aspx

[Jesse]

Thanks to both of you I really appreciate the quick response & helpful links!!