tax prep: is this persons gross income> $3100? (04 guidelines) dependent test. thank you!!?

Question

A woman's father lived with her and her husband all of 2004 until his death in Nov. 2004 (so I know that makes him a dependent). here is my problem, his sources of income were 1900 (salary - taxable), 3200 SS benefits (non-taxable), and 3500 unemploy benefits (taxable). First question, would this be gross income of 5400 (3500+1900) since the SS benefits are excluded? Here is my problem, he deposited $5000 of into a savings account and never used it (it does not specify what sources he took the $5000 from) so, do i assme that the $5000 came from the $5400 since that is his true GI? Also, it says the "remainder" of his support of $7500 was provoded to him by his daughter and son-in-law, $5100 of that was from funeral expenses, are funeral expenses considered support under the dependency test?
Bottom line, can this father be considered a dependent, or does he not meet the 04 criteria (50% support from child) and is his GI > $3100? Please help, thank you very muc

Answer 1

Unemployment benefits count towards his gross income, so he is not a dependent because of his earnings of $5400 for the year

FYI
Funeral costs are not support, but rent or mortgage payments, utilities, food, transportation provided and similar expenses do count. If he were a dependent any medical expenses paid by taxpayer would also count.

The precise source of his savings wouldn't matter if he qualified for dependency exemption.

The five thousand in decedent's bank account, if inherited by taxpayer is not a taxable event to taxpayer; (if the gross estate exceeded $1.5 million the estate would pay tax.)

Answer 2

Gross income includes unemployment compensation, so is over the limit for claiming the father as a dependent. Doesn't matter if he put it ALL into a savings account - what he did with the money can apply for the support test, but has nothing to do with the gross income test. So he does NOT meet the criteria for being a dependent. To be a dependent, he would have to meet ALL of the tests: support, AND gross income, and the others.

Sorry - I know that's not the answer you were hoping for.

Answer 3

Dependency status null when the father-in-law passed away. All support provided after that like funeral expense could not be counted . $5000.00 in his account would be inheritance and not be counted as income from other source.

Answer 4

Yes, you can claim the father as dependent, since he never used the money he rec'd. Plus, income test is for EARNED INCOME not for SS benifts and etc. But Surely consult a CPA before doing it.