THE LITC recently resolved a case for one of LITC`s youngest clients – a 22-year-old student who supported three members of his budget in the previous fiscal year. However, the IRS did not allow these dependency exemptions. The IRS did not believe that our client provided more than half of the assistance to his two nephews. The IRS was led to believe this because the client did not have receipts and paid everything in cash. For this reason, they do not have cheque or credit card statements or essential receipts. At the IRS, it appeared that the main supplier of the household was the client`s father. However, the father did not specifically support the relatives claimed by our client, which gave our client leeway to maintain his original registration status and claim the three persons as dependent. (1) No one has provided more than half of the individual assistance and, in some cases, the situation of a person may meet all the conditions required for a person to be considered dependent, with the exception of the latter, which provides more than half of the assistance. For example, a group of siblings could all intervene to pay for the cost of helping an aging parent. One of them could assume most of the responsibility of ”Dad,” including that he lives in his house, but she cannot claim him as dependent because she herself cannot bear most of the costs. Form 2120 comes in. (2) Any member of the group who, together, provided more than half of the individual aid would have the right to claim the individual as dependent, but not to have contributed more than half of that aid. 4.
Any other person in the group who has contributed more than 10% of this assistance provides the subject with a written declaration that that the other person will not claim the person as an employee for a taxable year from that calendar year. Each tax year, a person can claim the parent as a dependent, provided that he meets the requirements and submits a multi-assistance contract. Depending on the situation, they can choose to rotate those who claim it each year. In situations where programs such as social security or other public support funds provide most of the assistance to dependents, no one can claim the person as dependent. For example, if two children offer 20% assistance and social security offers 60% of the aid, no child can claim their parent as dependent. To resolve these tax controversies, the IRS`s lawyer proposed a simple solution.