Effects if deducting Grandchild as a dependent

[Chuckanut]

I have a question for anybody who has the experience to answer it.


I am helping my daughter (a single mom) return to college as an adult and get her degree. A good part of that help is providing a good home for her and my grandchild. I easily provide over 50% of the costs of keeping my grandchild fed, clothed, housed, transported, healthy, etc.



Because the grandchild's mom has zero income she gets some financial help with college expenses via scholarships. My daughter also gets food money (usually called food stamps though its on a card these days) and fully paid day care.



What I am wondering is this: If I claim my grandchild as a dependent on my 2018 tax return will that endanger any of the benefits my daughter gets, either for her education or to help feed and/or provide daycare for my grandchild? I need to know this since I would make up the difference if there was a loss of benefits. She is the controlling parent in decisions regarding my grandchild. Me? I'm just a Grandfather.



Just a side note: My daughter is doing great in college.

 

[Bamaman]

You should be okay to take the grandchild as a dependent if they're living with you and meet IRS criteria.

The daughter is another issue. If she's a student and under 24 years of age you could claim her as a dependent. Or, if she's permanently disabled you could claim her.

See pages 20-21 of the IRS Form 1040 instructions for specifics.

 

[Chuckanut]

You should be okay to take the grandchild as a dependent if they're living with you and meet IRS criteria.

The daughter is another issue. If she's a student and under 24 years of age you could claim her as a dependent. Or, if she's permanently disabled you could claim her.

See pages 20-21 of the IRS Form 1040 instructions for specifics.

Thanks. The daughter is to old for me to claim. It's only my grandchild that I am concerned about. I know I can claim her. What I am wondering if if anybody has lost other benefits for the child when that happens.

 

[kaneohe]

You should be okay to take the grandchild as a dependent if they're living with you and meet IRS criteria.

The daughter is another issue. If she's a student and under 24 years of age you could claim her as a dependent. Or, if she's permanently disabled you could claim her.

See pages 20-21 of the IRS Form 1040 instructions for specifics.

Even if daughter doesn't meet the student or age tests, she could be a dependent via being a qualifying relative. Keep reading those pages....

 

[Philliefan33]

Yes, read the IRS instructions carefully, or Google “Bogart tax tools” and use the Dependency Calculator. If your DD has no income and you are supporting her, she may qualify as a dependent. The granddaughter should easily qualify.

Now, about those benefits that your DD is getting. There will likely be no affect on her scholarships, but without knowing the details of the free childcare and SNAP benefits I can’t answer.

 

[Jerry1]

Now, about those benefits that your DD is getting. There will likely be no affect on her scholarships, but without knowing the details of the free childcare and SNAP benefits I can’t answer.

I wouldn’t be so sure on the not affecting her scholarships. Her benefits, all of them, need to be understood in order for you to determine whether or not it’s wise for you to claim your grandchild. I agree with others, while you’re doing the research, don’t assume you can’t claim you daughter. However, my guess is that any claiming of either the grandchild or the daughter will cost you more than the benefit from the deduction.

 

[Chuckanut]

I wouldn’t be so sure on the not affecting her scholarships. Her benefits, all of them, need to be understood in order for you to determine whether or not it’s wise for you to claim your grandchild. I agree with others, while you’re doing the research, don’t assume you can’t claim you daughter. However, my guess is that any claiming of either the grandchild or the daughter will cost you more than the benefit from the deduction.

That is my concern. Loss of one benefit would far exceed any income savings on my part.

In addition, I have gone out of my way to keep my life and situation separate from hers. She is the parent - a very good parent in my admittedly biased opinion. I am just the helpful grand-parent. I think that is healthier and safer for both of us.

 

[Spock]

first order smell test on losing benefits: why would she continue to get free day care for the grand kid if you are the one claiming the grandkid as a dependent and not her?

 

[Philliefan33]

first order smell test on losing benefits: why would she continue to get free day care for the grand kid if you are the one claiming the grandkid as a dependent and not her?

The daughter may not qualify to take the granddaughter as a dependent. If the grandfather is paying >50% of the cost to support the granddaughter, then the mother/daughter is not paying for the daughter/ granddaughter and cannot claim the child as a dependent.

It can get complicated, but you cannot select the dependency situation that benefits you most. The child is either a dependent of grandpa or mom (or in rare cases, neither), depending on who is paying the bills. And if mom/daughter is a dependent of dad/grandpa, she cannot claim the daughter/ granddaughter as a dependent