Level 2

Question

EIC

Forum|Forum|5 years ago
September 17, 2020
5 replies
29 views

Single parent has $6,500 in earned income & no unearned income & receives SSA. Qualifying child has $16,500 in unearned income & no earned income. Child receives SSA due to prior years death of father. Does single parent receive EIC for child. Child is 5 years old. Single parent lives in home with grandparents.

Lacerte Tax

This topic has been closed for replies.

sjrcpa

Level 15

Go through the worksheets and 8867 and see.

The more I know the more I don’t know.

T

TaxGuyBill

Level 15

Nothing in your post seems to disqualify it. Is there anything in particular that you think could disqualify it?

The only think I see is if the grandparents were to claim the child instead of the mom. That would disqualify EIC for the mom. Otherwise, I don't see anything in your post that would disqualify it.

qbteachmt

Level 15

Did you see what the IRS calculator tells you:

https://www.irs.gov/credits-deductions/individuals/earned-income-tax-credit/use-the-eitc-assistant

Don't yell at us; we're volunteers

G

gwtxcpaAuthor

Level 2

My concern was would the service wonder/challenge the child's support by parent given the parent's diminished income in relation to the child's unearned income. Unearned income for child was generated by father's life insurance proceeds.

T

TaxGuyBill

Level 15

@gwtxcpa wrote:
My concern was would the service wonder/challenge the child's support by parent

Support does not matter at all. In fact, even if the child provided over 1/2 of his own support (which would disqualify him from being a dependent), the parent could still claim EIC because EIC specially says that support does not matter.

However, if much of the child's money was used for support, you may want to fill out the Support Worksheet to see if the parent is eligible to claim the child as a dependent. But as I mentioned above, that would not affect EIC.

https://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf

qbteachmt

Level 15

Did you run through the Helper tool?

Don't yell at us; we're volunteers

G

gwtxcpaAuthor

Level 2

Yes, I did the helper tool several times. Each time it gave me an EIC of $1,777. My problem is with the child's unearned income being so high. I just hope that I am not missing something in that regard.

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