IRS issues guidance on qualifying child tie-breaking rule.Notice 2006-86 offers various examples of two or more taxpayers trying to claim the same child as a qualifying child. The guidance relates to claiming a child for purposes of determining heed-of-household filing status, the child and dependent care credit The Household and Dependent Care Credit is an American nonrefundable tax credit that can be claimed if a taxpayer paid someone to care for a qualifying individual so that the taxpayer could seek to be gainfully employed. , the child tax credit, the earned income credit Earned Income Credit A tax credit for low-income workers, even if no income tax was withheld from the worker's pay. Notes: This credit varies with family size, income and the number of children. , the exclusion for dependent care assistance and the dependency deduction, unless the special rule relating to a noncustodial parent applies. According to the IRS An abbreviation for the Internal Revenue Service, a federal agency charged with the responsibility of administering and enforcing internal revenue laws. , regulations will be issued in the future to reflect this guidance. (For background, see Cook, "The AICPA AICPA See American Institute of Certified Public Accountants (AICPA). Looks at the Uniform Definition of a Child," T/A, October 2006, p. 591.) by Lisa A. Winton, MBA, MST, AICPA Technical Manager--Taxation, Washington, DC |
|
||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion