Legal/Tax Question?

Question

My roommates are married (the girl is 19 and the guy is 21) and they filed joint on their taxes. Her mother is trying to claim her as a dependent (as she was living with her until August 2006). Her father is threatening to file a lawsuit against him (the guy) for filing illegally (something about their marriage not counting toward their tax filing). Would he have a case or is he just trying to cause more trouble?

Notes: They both let her mother know that they were filing joint TWO weeks prior to her mother filing. They've been married since the end of January 2007.

Here's the biggest issue regarding the joint file; H & R Block told them that they could file joint and did so for them. Would they still be required to pay the penalties for a false filing through H & R Block or does H & R Block have a guarantee in regards to e-filing? (Their website isn't working for me so I can't find anything on it but it's on their commercials)

I've gone through and looked over IRS tax laws and Texas Statute laws (specifically Family Code).

According to what I've found, her parents can't claim her (doesn't meet age req for qualifying child) and they are legally free in filing jointly.

If anyone has a chance, can they help me confirm my case as having any grounds?
http://dragonius.atspace.com/yanswers.html

Thanks for the help thus far as well :D

Answer 1

Wow, what a mess. If they were not married by the end of the tax year, then they cannot file a joint return. Because of her age and she lived with her parents for more than 6 months, they do have the right to claim her, as long as she did not provide more than half of her own support (doesn't matter if the parents provided half or not, as long as she didn't provide her own through work, or SSI, or whatever).

As for H&R Block, yes they have a guarantee where they will pay any interest and/or penalties if they make a mistake. However, that guatantee does not pertain to situations where the taxpayer(s) have decieved the company. In this case, if the tax preparer never asked WHEN they got married, they MIGHT have a shot, since they are young and dumb. However, it is the taxpayer's responsibility to KNOW and COMPLY with tax laws. They might be able to convince Block to file a discounted amended return, but I wouldn't count on it.

PS If H&R Block didn't ask the right questions, try using a different method of tax prep, like Jackson Hewitt, or Turbo Tax, or one of the e-file sites.

EDIT:
No, there is no case. Your roommates were wrong, whether intentional or not, they made a mistake. The parents CAN claim her if she lived in their home for more than 6 months (you said she DID) and she didn't provide more than half of her OWN support. Did she work? Does she get SSI? If she only worked for a few months, then it's not likely that she supported herself. These are Federal IRS rules, it doesn't matter what Texas says about it. Texas can decide how they want to handle their state returns, but generally speaking, if it's NOT allowed on Fed, then it's not allowed on the state, and vice versa. You have no case. Tell your roomies to file a 1040X for each of them, and pay back any refund they weren't entitled to.

If they had gotten married on December 31, 2006, then they could have filed a joint married return. But they didn't get married until 2007. They can file MFJ on their 2007 return.

Answer 2

If they didn't get married until January 2007, then they can't file a joint return for 2006, the year currently being filed for. So the dad would be right, their marriage would NOT count toward their tax filing, and depending on additional circumstances such as whether the girl was a full-time student and when she turned 19, her parents might have the right to claim her. If they do, the IRS will sort out who is entitled to the exemption, and will definitely disallow their filing joint for a year they were not married since it is illegal to do that. They should call the IRS, explain what they've done, and ask how to undo it before the filing deadline of April 17. In the meantime, do them a favor and tell them not to spend any refund they might have gotten, since they'll very possibly have to give some back.

It's not a matter of the dad filing a civil lawsuit. It's a matter of IRS rules and what the IRS can do about this false filing.

Answer 3

If they were married as of Dec 31, 2006 they can file a joint return and the parents CANNOT claim her as a dependent. It doesn't matter how long she lived with her parents or how much support her parents provided for 2006, her marriage trumps their exemption claim. PERIOD!

HOWEVER, since they weren't married until January of 2007, they CANNOT file a joint return. PERIOD!

Whether or not her parents can claim her as a dependent is another matter. If she turned 19 in 2006 and was not a full-time student, her parents can only claim her as a dependent if she lived with them for ALL of 2006 and she had less than $3,300 in gross income.

Based upon the information provided, her parents CANNOT claim her as a dependent since she did not live with them for ALL of 2006. She cannot file a joint return with her new husband for 2006 as they were not married as of Dec 31, 2006.

The father COULD file a tax fraud notice with the IRS if they filed a joint return. However, the IRS won't act on that until April 17, 2007 as they have until then to file a proper Single returns. If they filed a joint return, they should file amended returns for 2006 and change their filing status to Single. That will head off the father's saber-rattling.

If a tax preparer knew of their marriage date and prepared a joint return, he or she was breaking the law by preparing a fradulent return. They would have a hard time defending that as a prudent tax pro would ask what their marriage date was in order to determine the proper filing status.

Answer 4

Well, if they were not married on December 31, 2006 they can't file jointly. Period. If the girl lived with her parents for the most part of 2006 and they provided more than half of her support they can claim her as a dependent.
If they chose, to still ignore the whole thing and file jointly, the IRS will catch it almost immediately, as they will see the same social security number on two returns. The IRS will send them a letter and make them re-file, and pay back taxes with interest and penalty. If this is what they want to start their marriage with, well let them go ahead and do that. As far as father goes suing them... I don't think he needs to do that. The parents can just file their return, claim her as a dependent, and let the IRS catch them.

Answer 5

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Answer 6

Dad must really like his new son in law!!!!