While the passage of the 2018 Tax Reduction and Employment Act eliminated deductions for support creditors by 2025, the possibility of using a dependant may have other tax benefits. A taxable person can claim a qualified ascendant if he or she offers more than 50% of the parent`s assistance for a calendar tax year. , combines their resources to support the family. To claim a parent as a dependent, a taxpayer must complete a multiple support contract and submit IRS Form 2120. Every income that someone receives but does not spend on their own support is not counted as part of their own income used for their own support, in the need for assistance from a qualified parent. For example, if a person had an income of $2,700 but spent only $2,400 on their own support (for example. B accommodation, meals, clothes) and let`s say you spent more than $2,400 to help him, you provided more than half of your support. If you add Form 2120 upon your return, you recognize that you do not pay more than half of a person`s assistance fee, but that the people with whom you share the fee allow you to claim that person as a dependent. Anyone who contributes a minimum of 10% of the creditor`s care costs must provide you with a signed declaration that waives the right to the person as a dependent person. On the form, you must identify all these people using the name, address and social security number. (2) Any member of the group who, together, provided more than half of the individual`s assistance would have the right to assert the person as dependent, but because he did not contribute more than half of that assistance. A multiple assistance agreement is a document signed by two or more taxpayers who provide financial assistance to a single dependent person.
This agreement allows several individuals who jointly assist a creditor to take turns asserting that person as dependent on their tax return. A number of assistance agreements are required when several children contribute to the assistance of an elderly parent. Each tax year, a person can claim the parent as his or her dependant, provided that he meets the necessary conditions and presents a multiple assistance agreement. Depending on the situation, they may choose to rotate those who make this claim each year. One of the unique things about the multiple support agreement is that in order for someone to be considered a qualified parent, the person claiming it for release from addiction must provide more than half of the unLESS assistance „There are exceptions for several assistance agreements, children of divorced or separated parents (or separated parents) and abducted children.” (Publication 17) (3) The member of the group who claims the person as dependent has contributed more than 10 percent of the person`s assistance, and to call someone as a dependent on Form 2120, you must have paid at least 10% of the assistance fee. In addition, no person on the form may have paid more than 50% of the assistance fee. Add Form 2120 when you return, but don`t include signed instructions. Keep them for your own recordings and be prepared to produce them if necessary. 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.