We are on public assistance and my parents loan us money to pay rent until I can get back on my feet again. I'm afraid that them loaning us money then claiming us would be double dipping...?
2007-01-23 13:47:35 · 4 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
they can only claim them if the kids lived with them
and if you claim them on public assistance they are your dependents,not your parents..it will be double dipping and against the law and your parents can be sent to jail after being audited..
2007-01-23 13:59:14 · answer #1 · answered by alleykhad607 5 · 0⤊ 0⤋
A taxpayer cannot make a loan to another taxpayer and then use that as a basis to claim a dependency exemption. A loan is not support.
From your question, it seems that the grandparents did not live with the children for more than 6 months.
They cannot claim the grandchildren.
If you have any earned income at all, file a return and get the EIC for the children. Receiving public assistance does not disqualify you from the EIC. If the public assistance made up more than half of the children's support, then you cannot take a dependency exemption for the children. But even then, you can still get EIC without claiming the children as dependents.
2007-01-23 14:45:10 · answer #2 · answered by ninasgramma 7 · 0⤊ 0⤋
Hello,
The answer is not as clear cut as it sounds.. it depends on several things. One being did your parents provide over 1/2 their support? The IRS has changed these rules in the last couple of years.. I'd have to do some more research.. contact me if you don't get a definite answer.. double check that answer at the irs.gov
2007-01-23 14:38:01 · answer #3 · answered by Mrs Tax Lady 1 · 0⤊ 0⤋
You better ask a tax pro.
2007-01-23 13:57:12 · answer #4 · answered by badbill1941 6 · 0⤊ 0⤋