CTC Qualifying Child

[Snaggletooth]

In order for a child to qualify for Child Tax Credit, I have used the qualifiers listed on page 11-3 of TTB. Note that qualifier #4 is "Did not provide over half of his/her own support for 2007." However, in the same text, the reader is referred to Tab 3 for Uniform Definition of a Child. Tab 3 dedicates itself to many aspects of the child, but refers back to page 11-3 for the Child Tax Credit.

Client cannot claim adopted daughter, because of large survivors' benefit coming from Social Security for deceased father. Thus the child is not a dependent. However, the child is NOT supporting herself, and on the face of qualifier #4 above, appears to meet this qualifier and all the others.

The obvious question: Does the child qualify for CTC?

Another corollary question, will the parents receive $300 for the kid this summer? If not, can a tax return be filed for the child (as a recipient of SS) to trigger her own $300 receipt? I don't think the nature of her income qualifies for this but thought I would ask...

[JG EA]

I believe that CTC requires the Child be a dependent Except (TTB)

"In the following situations, child tax credits
can be claimed for a qualifying child who cannot be claimed as
a dependent:
• The taxpayer or spouse can be claimed as a dependent.
• The taxpayer is a nonresident alien not allowed to claim dependent
exemptions.
• The taxpayer’s qualifying child is married and files a joint return
that is not simply a claim for refund.
File Form 8901, Information on Qualifying Children Who are Not
Dependents, with the return."

And I would say the parents won't get a rebate if not a dependent on the return. But for the child there appears to be no age limit if the income is the right categories.

[Kram BergGold]

Contradiction

Snag, you are contradicting yourself here.

"Client cannot claim adopted daughter, because of large survivors' benefit coming from Social Security for deceased father. This the child is not a dependent. However, the child is NOT supporting herself"

If all of the survivor's benefits are less than 50% of support then the adoptive parent do support the child and can claim the child as a dependent and get CTC. If the benefits do constitute more than 50% of support then adoptive parents can't claim child as a dependent and then no CTC.

[Snaggletooth]

Read Carefully

Mark, I hope I'm not contridicting myself, because if you have read my post and believe that I have, others may also do the same.

Neither the child nor the parents are furnishing over 50% of the support. Over 50% of the support is coming from the government. Father died at a young age, and social security is furnishing survivors' benefits.

Thanks for reading the post, and commenting.

Snag

[David1980]

An adopted child would be treated as their own child.

The rules specify for qualifying child tests "The child must not have provided more than half of his or her own support for the year."

It does not say the parents have to provide over 50%.

Pub 17 does say "If a child receives social security benefits and uses them toward his or her own support, the benefits are considered as provided by the child."

So my interpretation based on the above would be the child is providing over 50% of their own support, due to the social security benefits they receive. They would not qualify as a dependent, they also would not qualify for CTC.

However, you could go into this another method as well. Pub. 17 "Who is a qualifying child" for CTC requires that for each qualifying child you must either check the box on form 1040 or 1040A on line 6c, or complete a form 8901. The former would obviously require you claim the person as your dependent, and form 8901 is used if you are not claiming that person as your dependent.

So if we go into the form 8901 instructions let's see who can use that form.
1) If you, or your spouse can be claimed as a dependent on someone else's return.
2) You are a nonresident alien who can't claim exemptions for your dependents.
3) Your qualifying child is married,

Each of those have their own requirements, but clearly none seem apply to your situation. As such taxpayer cannot claim child tax credit unless they also claim the child as their own dependent.

[cathyan103]

No one has asked what the SS benefits are being used for. Are they used to help run the household, or being put away for the child's future? Is the parents income so low that there is no way they can be providing at least half the support?

[Snaggletooth]

Thanks to All

From the comments, looks like the child does not qualify for the child tax credit.

Cathyan, you're new, so welcome to the board. Your questions (and answers) will be appreciated. Good observation on my question. Survivor benefits from SS are almost $8000 annually until child reaches 18, and there are five other children. Absent any other circumstances, her support must be at least $16,000 for anyone to claim they are furnishing over 50%. Parents AGI nearly $60K. Hard to support.

In my part of the country, AGI of $30,000-$40,000 is middle income. Actually closer to "upper" middle-income.

If benefits were going into savings, yes, there is potential. Thanks for your comments, and visit us often.