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Filing status of unmarried taxpayers living as a couple.



Optimizing the Tax

Aspects of Cohabitation A living arrangement in which an unmarried couple lives together in a long-term relationship that resembles a marriage.

Couples cohabit, rather than marry, for a variety of reasons. They may want to test their compatibility before they commit to a legal union.
 

While the Tax Reform Act of 1986 (TRA TRA Training
TRA Transfer
TRA Transition
TRA Tennessee Regulatory Authority
TRA Telecommunications Regulatory Authority (Oman)
TRA Tax Reform Act (1976, 1984, or 1986)
TRA Teachers Retirement Association
) generally lowered income tax rates for the average taxpayer, the Revenue Reconciliation Act of 1993 (RRA RRA Registered Record Administrator. ) increased such rates. For taxpayers filing jointly, the RRA reinstated the so-called "marriage penalty," i.e., the additional tax owed by married taxpayers over what would have been due if the taxpayers had remained single and earned the same income.(1) The RRA increased the severity of the marriage penalty for many taxpayers at various income levels, in part due to the increased progressivity pro·gres·siv·i·ty  
n. pl. pro·gres·siv·i·ties
The quality or degree of being progressive: "Proponents of progressivity often argue that higher-income people should pay higher taxes because they benefit more
 of the tax brackets Tax Bracket

The rate at which an individual is taxed due to a particular income level.

Notes:
Each income class is taxed at a different level. Generally, the more you make the more you are taxed.
. As a result, taxpayers might consider alternatives to married filing jointly Married Filing Jointly

A filing status for married couples that have wed before the end of the tax year. They can record their respective incomes, exemptions and deductions on the same tax return. Married filing jointly is best if only one spouse has a significant income.
 (MFJ MFJ Married Filing Jointly
MFJ Modified Final Judgment
MFJ Martin F. Jue (founder of MFJ Enterprises, Inc.)
MFJ Modified of Final Judgment
MFJ Meta Font Job
) status. In addition, unmarried couples living together have become more common. This article discusses the determination of filing status, the definition of "marriage" under state and Federal law, and the planning opportunities for unmarried cohabiting taxpayers desiring to minimize their tax liability.

Marital Status marital status,
n the legal standing of a person in regard to his or her marriage state.
 - Federal Law

Sec. 7703(a)(1) provides that, for Federal tax purposes, the determination of whether a taxpayer is married is made on the last day of the year; for most individuals, this is December 3 1. Thus, if two taxpayers are married on December 31 of a given year, the couple is deemed married for the entire year and may file jointly for that year. They may also file as married filing separately Married Filing Separately

A filing status for married couples who choose to record their respective incomes, exemptions and deductions on separate tax returns. This method is opposite to "married filing jointly" and has few benefits.
, but this filing status usually results in a higher combined income tax than if the couple had filed MFJ.(2) Even though the taxpayers were unmarried for the majority of the tax year, neither taxpayer can use an unmarried filing status (i.e., single or head of household). Finally, under Sec. 6013(a)(1), a married couple cannot use MFJ status if one taxpayer is a nonresident non·res·i·dent  
adj.
1. Not living in a particular place: nonresident students who commute to classes.

2.
 alien.

Marital Status - State Law

* Common-law marriage common-law marriage: see under husband and wife.
common-law marriage

Marriage that is without a civil or religious ceremony and is based on the parties' agreement to consider themselves married and usually also on their cohabitation for a period of
 

The determination of marital status for Federal tax purposes hinges on the definition of marriage under the law of the state in which the couple resides.(3) For an unmarried cohabiting couple, if their state of residence recognizes common-law marriage, the couple is married for Federal income tax purposes(4); if the state does not recognize common-law marriage, the couple is not married for Federal income tax purposes.(5)

Common-law marriage is a marriage not formalized for·mal·ize  
tr.v. for·mal·ized, for·mal·iz·ing, for·mal·iz·es
1. To give a definite form or shape to.

2.
a. To make formal.

b.
 in the usual manner. The couple usually has an agreement to marry followed by cohabitation. Generally, there must be a public recognition of the relationship on a continuing basis. Common-law marriage is recognized in 13 states (Alabama, Colorado, Georgia, Idaho, Iowa, Kansas, Montana, Ohio, Oklahoma, Pennsylvania Oklahoma is a borough in Westmoreland County, Pennsylvania, United States. The population was 915 at the 2000 census. Geography
Oklahoma is located at  (40.581613, -79.574586)GR1.
, Rhode Island Rhode Island, island, United States
Rhode Island, island, 15 mi (24 km) long and 5 mi (8 km) wide, S R.I., at the entrance to Narragansett Bay. It is the largest island in the state, with steep cliffs and excellent beaches.
, South Carolina South Carolina, state of the SE United States. It is bordered by North Carolina (N), the Atlantic Ocean (SE), and Georgia (SW). Facts and Figures


Area, 31,055 sq mi (80,432 sq km). Pop. (2000) 4,012,012, a 15.
 and Texas) and the District of Columbia District of Columbia, federal district (2000 pop. 572,059, a 5.7% decrease in population since the 1990 census), 69 sq mi (179 sq km), on the east bank of the Potomac River, coextensive with the city of Washington, D.C. (the capital of the United States). .(6)

If the couple has an accepted common-law marriage in a state that recognizes such marriages, the "marital" status is not forgone by establishing residence in another state, whether or not the new state of residence recognizes common-law marriage.(7) Thus, the couple is married for Federal tax purposes.

Planning tip: A state may recognize common-law marriage and simultaneously allow a cohabiting couple to choose whether they want to be considered as married. In such case, the couple may decide not to file a joint return, but select an unmarried filing status if a lower tax results, which could occur if both taxpayers have taxable income Under the federal tax law, gross income reduced by adjustments and allowable deductions. It is the income against which tax rates are applied to compute an individual or entity's tax liability. The essence of taxable income is the accrual of some gain, profit, or benefit to a taxpayer.  and use the standard deduction The name given to a fixed amount of money that may be subtracted from the adjusted gross income of a taxpayer who does not itemize certain living expenses for Income Tax purposes. . The total combined tax may be greater if the couple files MFJ than if they file as single taxpayers.

Obviously, the potential tax liability should be computed under different scenarios. When only one of the taxpayers in a recognized common-law marriage has taxable income, it is generally more advantageous for the couple to file MFJ.

* Same-sex marriages Noun 1. same-sex marriage - two people of the same sex who live together as a family; "the legal status of same-sex marriages has been hotly debated"
couple, twosome, duet, duo - a pair who associate with one another; "the engaged couple"; "an inseparable
 

Because the validity of marriage depends on local law, taxpayers of the same sex cannot be married for Federal income tax purposes if they reside in a state that does not allow same-sex marriage.(8) In such a state, while a "marriage" ceremony may have the suggestion of legality, the marriage is ignored for Federal income tax purposes.

Planning tip: One option in some jurisdictions might be for one adult taxpayer to adopt another. In this case, head-of-household filing status could be selected, with one adult taxpayer serving as the "parent."

* Annulments

If a marriage is void from its inception under state law, the Service considers the couple unmarried for the entire length of the "marriage."(9) As a result, the taxpayers must file amended returns Amended Return

A return filed in order to make corrections to a tax return from a previous year. It can be used to correct errors and claim a more advantageous filing.

Notes:
An amended return is filed using Form 1040X.
 reflecting single (or head-of-household, if appropriate) filing status for all open tax years.(10) Even in the situation of a void marriage A void marriage is a type of marriage which is on its face unlawful under the laws of the jurisdiction where it is entered, or potentially where the persons who contracted the marriage normally reside. , however, the Tax Court has held that the taxability of periodic payments made under an annulment annulment

Legal invalidation of a marriage. It announces the invalidity of a marriage that was void from its inception. It is to be distinguished from dissolution or divorce. To justify annulment, the marriage contract must have a defect (e.g.
 decree is determined under the rules regarding taxation of alimony alimony, in law, allowance for support that an individual pays to his or her former spouse, usually as part of a divorce settlement. It is based on the common law right of a wife to be supported by her husband, but in the United States, the Supreme Court in 1979 , because the putative marriage PUTATIVE MARRIAGE. This marriage is described by jurists as "matrimonium putativum, id est, quod bona fide et solemnitur saltem, opinions conjugis unius justa contractum inter personas vetitas jungi." Hertius, h.t.  can create a legal obligation of support.(11) As a result, an annulment can void a marriage for joint return purposes while potentially allowing the general taxability/deductibility of alimony payments.

* Invalid or out-of-state divorce

Not all divorce decrees are effective for Federal income tax purposes. The IRS An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws.  generally will not question the validity of a divorce decree until a court of competent jurisdiction declares the divorce to be invalid. However, if a state court declares the prior divorce to be invalid, the IRS will usually follow that later court decision, rather than the divorce decree, for Federal income tax purposes for years not barred by the statute of limitations A type of federal or state law that restricts the time within which legal proceedings may be brought.

Statutes of limitations, which date back to early Roman Law, are a fundamental part of European and U.S. law.
.(12) Thus, taxpayers are still married for Federal income tax purposes if their resident state disregards an out-of-state divorce.

Planning tip: Care should be taken in planning a divorce and later remarriage Re`mar´riage   

n. 1. A second or repeated marriage.

Noun 1. remarriage - the act of marrying again
 to the same person. In certain cases, the divorce will be ignored for Federal income tax purposes. For example, if married taxpayers receive a divorce late in one tax year and remarry remarry
Verb

[-ries, -rying, -ried] to marry again following a divorce or the death of one's previous spouse

remarriage n

Verb 1.
 each other early in the next tax year, the Service ignores the divorce as a sham transaction. The Service will look for intent to remarry as an indication of a tax avoidance The process whereby an individual plans his or her finances so as to apply all exemptions and deductions provided by tax laws to reduce taxable income.

Through tax avoidance, an individual takes advantage of all legal opportunities to minimize his or her state or federal
 motive behind the divorce.(13) If it can be proven that remarriage was not contemplated at the time of divorce, the divorce will stand.(14)

* Decree of divorce or separate maintenance

Under Sec. 7703(a)(21), a taxpayer who is legally separated from his spouse under a decree of divorce or separate maintenance is not married for Federal income tax purposes. If the decree of divorce or separate maintenance is obtained on the last day of the tax year, the taxpayers are unmarried for Federal income tax purposes for the entire tax year.(15) However, taxpayers who are separated only by a written separation agreement are married f or Federal income tax purposes.(16)

Planning tip: Legal separation is determined by the type of decree or agreement. Therefore, taxpayers separated by a written separation agreement are married, while taxpayers under a decree of divorce or separate maintenance are legally separated (i.e., unmarried).(17) However, to be legally separated, the taxpayers do not necessarily have to live in separate residences.

For example, in Sydnes,(18) the Tax Court held that taxpayers cannot be legally separated if they live under the same roof. However, the Eighth Circuit, in reversing the Tax Court, stated that whether the taxpayers were separated was a question of fact, not one of law, and that taxpayers living under the same roof, in appropriate circumstances, could be legally separated.

In Lyddan,(19) the Second Circuit held that an individual who cohabited with his wife could not claim head-of -household status. Thus, the facts of each case will determine marital status. In addition, Sydnes and Lyddan discussed legal separation in the context of the taxation and deduction of alimony paid under pre-1984 divorce decrees. The determination of marital status for filing purposes might involve a different analysis.

The Cohabitant co·hab·it  
intr.v. co·hab·it·ed, co·hab·it·ing, co·hab·its
1. To live together in a sexual relationship, especially when not legally married.

2. To coexist, as animals of different species.
 as Dependent

* Dependency exemption tests

If the state does not recognize common-law marriage, taxpayers who live together may be able to claim one of the cohabitants as a dependent if certain tests are met. For 1995, Sec. 151(d) allows a taxpayer to claim a $2,500 exemption for an adult dependent if all of the following tests (dependency exemption tests) are met: 1. Support test: The taxpayer provides over one-half of the dependent's total support during the calendar year (Sec. 152(a)). 2. Gross income test: The dependent has gross income of less than $2,500 in 1995 (Sec. 151 (c)(1)). 3. Citizenship or residency test: The dependent is a U.S. citizen, resident or national, or a resident of Canada, Mexico, the Panama Canal Zone Panama Canal Zone, former territory within Panama, 553 sq mi (1,432 sq km), that was administered by the United States under a 1903 treaty (with later amendments) with Panama. The zone included the Panama Canal and an area extending 5 mi (8.1 km) on each side.  or the Republic of Panama at some time during the calendar year in which the taxpayer's tax year begins.(20) 4. Joint return test: The dependent has not filed a joint return (Sec. 151(c)(2)). 5. Member-of-household or other relationship test: The dependent is a relative (as defined in Sec. 152(a)(1-8)), or an unrelated member of the household (as defined in Sec. 152(a)(9)), who lives with the taxpayer for the entire year.

The fifth test can be difficult to satisfy. Regs. Sec. 1.152-1 (b) provides that an individual is not a member of the taxpayer's household if at any time during the tax year the relationship between the individual and the taxpayer is in violation of local law.(21) Cohabitation is legal in some states, as long as neither cohabitant is married to someone else. There are no statutes prohibiting cohabitation in the following states: California, Connecticut, the District of Columbia, Delaware, Georgia, Hawaii, Kentucky, Louisiana, Maine, Maryland, Minnesota, Missouri, New jersey, Nevada, New Hampshire New Hampshire, one of the New England states of the NE United States. It is bordered by Massachusetts (S), Vermont, with the Connecticut R. forming the boundary (W), the Canadian province of Quebec (NW), and Maine and a short strip of the Atlantic Ocean (E). , New York New York, state, United States
New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of
, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota South Dakota (dəkō`tə), state in the N central United States. It is bordered by North Dakota (N), Minnesota and Iowa (E), Nebraska (S), and Wyoming and Montana (W). , Tennessee, Texas, Utah and Vermont.(22)

Planning tip: Unmarried couples living in states with laws barring cohabitation may be able to argue against Regs. Sec. 1.152-1(b) using Sec. 162 and the regulations thereunder. With regard to ordinary and necessary business expenses, Sec. 162(c)(2) states that no deduction is allowed for any illegal payment made "under any law of a State (but only if such State law is generally enforced), which subjects the payor to a criminal penalty or the loss of license or privilege to engage in a trade or business." Additionally, Regs. Sec. 1.162-1(a) states that an otherwise allowable Sec. 162 deduction "shall not be denied on the grounds that allowance of such deduction would frustrate a sharply defined public policy." To circumvent the disallowance dis·al·low  
tr.v. dis·al·lowed, dis·al·low·ing, dis·al·lows
1. To refuse to allow: "[The government]
 of a dependency exemption under Regs. Sec. 1.152-1(b), a cohabitant might argue that (1) the state of residence does not enforce cohabitation statutes and (2) the cohabitant meets four of the five dependency exemption tests; therefore, the exemption should be allowed, even if it would frustrate state public policy.

When one cohabitant is married to someone other than the other cohabitant, state adultery statutes apply. Under Regs. Sec. 1.152-1(b), the dependency exemption would be unavailable, regardless of whether state law permits cohabitation.

Cohabitants and Head-of-household Filing Status

Can cohabiting taxpayers file as head of household? Head-of-household filing status may be used by certain taxpayers who are unmarried and provide more than one-half of the cost of maintaining a household (household test) for any of the following: (1) the taxpayer's unmarried child living at home for the entire year, (2) the taxpayer's mother or father, whether or not living in the taxpayer's household or (3) a relative of the taxpayer who qualifies as a dependent under Sec. 151. If the taxpayer qualifies for head-of-household status under either of the first two categories, the existence of the cohabitant does not render the taxpayer ineligible for such status. However, under the third category, in a state that does not bar cohabitation, the taxpayer would be entitled to such status if the dependency exemption tests were met; in a state that bars cohabitation, even if the other four dependency exemption tests are met, because there is a genuine question as to whether the member-of-household test is met, the taxpayer would not automatically be entitled to claim the cohabitant as a dependent and so qualify for head-of-household status; the taxpayer would need a qualifying dependent to file as head of household.

However, head-of-household status would be available to both cohabitants if each had a child who lived with the cohabiting couple. The fact that they all live in a single dwelling would not preclude such status.

If cohabitants have children as a result of their relationship, varying tax consequences could result. For example, if the arrangement qualifies as a common-law marriage under state law, a joint return could be filed, and the children would be dependents under the general rules. If the arrangement does not qualify as a common-law marriage, but the state does not bar cohabitation, one taxpayer might be able to claim head-of-household status and claim the cohabitant and/or the children as dependents, provided the household test were met for the cohabitant and children and the dependency exemption tests were also met for the cohabitant; or, each cohabitant could file as single, and whichever parent passed the household test for each child would be allowed to claim the child as a dependent.

Cohabitation and Custody

For parents who are divorced, legally separated, separated under a written separation agreement or who have lived apart at all times during the last six months of the year, Sec. 152(e) generally provides that the custodial parent gets the dependency exemption, if that parent has custody for the greater part of the year and passes the support test. For this rule to apply, the child must receive over one-half of his support during the calendar year from his parents and be in the custody of one or both of the parents for more than one-half of the year.

This rule applies in the absence of a written agreement stating that the custodial parent waives the right to the dependency exemption. Form 8332, Release of Claim to Exemption for Child of Divorced or Separated Parents, must be attached to the tax return of a noncustodial non·cus·to·di·al  
adj.
1. Not having custody of one's children after a divorce or separation: a noncustodial parent.

2.
 parent claiming a child as a dependent.

A taxpayer cohabiting with a custodial parent may claim the child as a dependent if the household and dependency exemption tests are met.

Itemized Deductions Itemized Deduction

A deduction from a taxpayer's taxable adjusted gross income that is made up of deductions for money spent on certain goods and services throughout the year.
 

The deductibility of itemized deductions for unmarried cohabiting taxpayers depends on whether the arrangement is considered a common-law marriage under state law. If the couple is considered married under state law and MFJ status is selected, deductible expenses may be itemized, regardless of which taxpayer paid them. If the couple is not considered married under state law, and the taxpayers file as single, each may only deduct expenses incurred on his own behalf.

* Medical expenses

A common itemized deduction is medical expenses paid for the benefit of another. Sec. 213(a)(1) allows a deduction for medical expenses incurred by the taxpayer on behalf of the taxpayer, spouse and dependents (as defined in Sec. 152(a)).(23) The definition of "dependent" in Sec. 152 includes certain family members, persons related by marriage and certain unrelated members of the household. Therefore, in a state that bars cohabitation, medical expenses paid for by one cohabitant for another or the other's children would not be deductible, but would be if the state does not bar cohabitation and the support test is met.

Under Sec. 152(b)(2), adopted children are dependents. As previously discussed regarding same-sex marriages, certain jurisdictions may allow one adult to adopt another. This would permit the deduction of the medical expenses paid by one taxpayer for another, if the support test is met.

* Gift tax consequences

Under Sec. 2503(e)(1), the payment of medical expenses for another is not a gift for gift tax purposes. The gift tax exclusion is not based on the parties' relationship; however, the medical expenses are deductible only if incurred by the taxpayer on behalf of the taxpayer, spouse and dependents, whether or not the payor had a legal obligation to make such payments.

Planning tip: Careful planning must be done by a couple living together in a state that does not recognize common-law marriage to make the best use of itemized deductions and to address any gift tax considerations. For example, unmarried cohabiting taxpayers may want to buy and jointly own a home. Both names should appear on the title or deed. Also, because generally the support test will not be met, the taxpayers must use the single filing status; thus, each should write a check for his share of the mortgage and property taxes.

Conclusion

With the RRA's reinstatement Reinstatement

The restoration of an insurance policy after it has lapsed for nonpayment of premiums.
 of the marriage penalty, taxpayers may want to consider their options before marrying. Unmarried taxpayers who are cohabiting should review the tax consequences of their arrangement. Since state law determines marital status for Federal income tax purposes, cohabiting taxpayers in states recognizing common-law marriage are married for Federal income tax purposes; however, they may have the option of filing as single taxpayers. Cohabiting taxpayers in states that do not recognize common-law marriage are single taxpayers for Federal income tax purposes. Filing as a single taxpayer can eliminate deductions when payments have been made on behalf of the cohabitant and/or his children.

A careful analysis should be made of (1) the state law regarding cohabitation, (2) the taxpayers' situation and (3) the various Federal and state tax options to optimize the tax aspects of the arrangement.

(1) See H. David Boyter. 74 TC 989 (1980), rem'd, 668 F2d 1382 (4th Cir. 1981)(49 AFTR AFTR American Federal Tax Reports (Prentice-Hall)
AFTR Americans For Tax Reform
AFTR Air Force Training Ribbon
AFTR Air Force Training Record
AFTR atrophy, fasciculation, tremor, rigidity
AFTR Atomic Frequency Time Reference
2d 82-451, 82-1 USTC USTC University of Science and Technology of China
USTC United States Tax Cases (Commerce Clearing House)
USTC United States Transportation Command (see USTRANSCOM) 
 [paragraph]9117). (2) But see Persellin and Mason, "Married Taxpayers May Maximize Savings By Filing Separately," 25 The Tax Adviser 564 (Sept. 1994). (3) See Boyter, note 1. (4) Rev. Rul. 58-66, 1958-1 CB 60; see James M. Ross, TC Memo 1972-122. (5) Joseph F. Amaro, TC Memo 1970-208; Cassius L. Peacock, III, TC Memo 1978-30. (6) See Ellsworth, "Prescribing TUMS: An Alternative to the Marital Deduction marital deduction n. when one spouse dies, the survivor may take a tax deduction of half of the value of the estate of the dying spouse. Thus, the minimum value of the estate before there is a possible federal estate tax rises from $600,000 to $1,200,000 at the death  for Unmarried Cohabitants," 11 Virginia Tax Review 137 (Summer 1991). (7) Rev. Rul. 58-66, note 4; Alfred L. Von Tersch, Jr., 47 TC 415 (1967); Milton Peveler, TC Memo 1979-460. (8) See, e.g., Jones v. Hallahan, 501 S.W.2d 588 (1973); Singer v. Hara, 522 P.2d 1187 (1974); Baehr v. Lewin, 852 P.2d 44 (1993). (9) Rev. Rul. 76-255, 1976-2 CB 40; see Andrew M. Newburger, 61 TC 457 (1974); George F. Reisman, 49 TC 570 (1968). (10) Rev. Rul. 76-2,55, id. While the ruling states that amended returns must be filed, there is no statutory provision requiring the filing of an amended return. See Bartlett v. Delaney, 75 F Supp F SUPP Federal Supplement (decisions of US district courts)  490 (DC Mass. 1948)(136 AFTR 1261, 48-1 USTC [paragraph]9158), aff'd, 173 F2d 535 (1st Cir. 1949)(37 AFTR 1157, 49-1 USTC [paragraph]9219), cert. denied. (11) Newburger, note 9; Denny C. Williamson, TC Memo 1978-279. (12) Rev. Rul. 67-442, 1967-2 CB 65. (13) Rev. Rul. 76-255, note 9. (14) IRS Letter Ruling 7835076 (6/1/78). (15) Secs. 7703(a)(1) and 6013(d)(1)(A). (16) Stanley A. Dunn, 70 TC 361 (1978), aff'd in unpub'd op., 607 F2d 995 (2d Cir. 1979) (temporary order not a legal separation); Gene Forrest, TC Memo 1978-239 (support order not a legal separation); R. T. Capodanno, 69 TC 638 (1978), aff'd, 602 F2d 64 (3d Cir. 1979) (44 AFTR2d 79-5164, 79-2 USTC [paragraph]9447) (same); James F. Donigan, 68 TC 632 (1977) (separation agreement not a legal separation). (17) See Secs. 71(b)(1)(C), 6013(d)(2) and 7703(a)(2). (18) Richard J. Sydnes, 577 F2d 60 (8th Cir. 1978)(42 AFTR2d 78-5143, 78-2 USTC [paragraph]9487), aff'g, rev'g and rem'g 68 TC 170 (1977); but see Marion S Marion.

1 City (1990 pop. 14,545), seat of Williamson co., S Ill.; inc. 1841. It is the commercial and retail center of a farm and coal area and has a large soft drink bottling plant. A maximum-security federal prison is nearby.
. Del Vecchio Del Vecchio is a surname, and may refer to:
  • Gennaro Del Vecchio, Italian football player
  • Leonardo Del Vecchio, Italian businessman
  • Marco Delvecchio, Italian football player
  • Alex Delvecchio, Canadian ice hockey player
, TC Memo 1973-245 (under Pennsylvania law, couple is not legally separated if they live under the same roof). (19) William C. Lyddan, 721 F2d 873 (2d Cir. 1983)(51 AFTR2d 83-808, 83-2 USTC [paragraph]9706). (20) Sec. 152(b)(3); Regs. Sec. 1.152-2(a)(1). (21) See. Leon Turnipseed, 27 TC 758 (1957). (22) King, The Cohabitation Handbook (Ten Speed Press, 1975), at 126. (23) A medical deduction is allowed for a Sec. 152(a) dependent even if a dependency exemption cannot be claimed on the individual's income tax return because the Sec. 151(c) gross income threshold is exceeded.
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Author:Garrison, Larry R.
Publication:The Tax Adviser
Date:Apr 1, 1995
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