Broadband Tech > General Questions > Another tax question

Another tax question

Are they filing joint or separately?
Looks like they are doing them separately form your post!
Would make a big difference!

they are filing seperately-not married til March of this year

reply to dingo
If I understand correctly, your daughter is with someone she is currently engaged to. The two children are the natural children of your daughter and the fiancee.

I would reason to bet that they would be much better off to have one of them file as head of household claiming both of the children and all of the applicable credits (EIC, Child tax credit etc.). This person should be the one with the lower income.

The other should just file as single claiming no dependants.

Without knowing the specific earnings and without doing the math myself and only going from experience, I would think that the credits earned filing this way would result in a large return. And if the other partner has structred their withholdings properly they should not owe any tax and even still have some amount of return.

Unless there are other reasons for wanting to claim one child each, I would think that doing so would not be optimal

reply to dingo
why not have them put their individual income numbers into any of the free online tax programs like TaxAct or H & R Block. Run the numbers as each claiming one child vs one claiming both, one none. Just see where the numbers take as to their best option.

reply to dingo
I too would suggest doing the full EIC on whomever has the lower income.

reply to dingo
this is a situation where it is best to prepare returns for each combination to see which provides the best return. requires a little more work but worth it.

reply to dingo
If one of them contributes more than 50% of the household expenses, that person files HOH and using the kids for EITC, and the other files single using their own exemption, as that might be best. And yes, each one can also claim a kid.

Then again, if they live in a state where it is legal for them to live together, then the whole situation changes. One can claim the other as a dependent. Here in Florida, I don't have to worry about that.

Have them consult a local Enrolled Agent or other tax pro.
--
Bad Florida Drivers

reply to dingo
They are going to run the numbers thru the free turbo tax as suggested. I promise to get back to all with the results. I really appreciate all the help-you folks make me look much smarter to my kids than I am.....Thank you

reply to BoulderHill1