SSDI Lump Sum Taxes & Taxable child's SSDI

[lbsrt4]

My wife has recently been awarded SSDI & has rec'd a lump sum payment covering 2 years. In addition, one child will also be receiving a SSDI check. I have the following questions:

1. Taxes on my wife's SSDI lump sum: Is the best approach to take the LSE option on 2007 tax year's return? We'll have to claim 85% based on my income. Are there any other options (better or worse)?

2. Child's SSDI check: Should the check be in the child's name? Do the tax implications change based on who the child's check is made out to? Does that income have to be claimed as part of our AGI, regardless of who's name the child's check is in? The child currently has no income, but that will probably change next year.

Thanks in advance for any help.

Larry

[BOB W]

My wife has recently been awarded SSDI & has rec'd a lump sum payment covering 2 years. In addition, one child will also be receiving a SSDI check. I have the following questions:

1. Taxes on my wife's SSDI lump sum: Is the best approach to take the LSE option on 2007 tax year's return? We'll have to claim 85% based on my income. Are there any other options (better or worse)?

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///////In many cases spreading the lumpsum over two years with the special calculation does not work, but you need to try it. //////////////////////////////////////////////////////////////////////////////////////////////////////////////////////


2. Child's SSDI check: Should the check be in the child's name? Do the tax implications change based on who the child's check is made out to? Does that income have to be claimed as part of our AGI, regardless of who's name the child's check is in? The child currently has no income, but that will probably change next year.

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I have only seen checks made payable to the parents, if any, otherwise it would go to a guardian I believe. Any SS is taxed to the child, So don't include it in your's income.///////////////////////////////////////////////////////////////////////////////////////////////////////////////////

Thanks in advance for any help.

Larry

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