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Author: defendor Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121592  
Subject: Head of Household Date: 2/13/2002 2:05 PM
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Does anyone know about qualifying as a head of household regarding a dependent parent? I know that the rule says the head of household must pay over 50% of the dependent's housing cost, but what if the parent lives in a nursing home? If the governement subsidizes part of the cost, does that count towards the 50%? Example: monthly cost $1,500 with $1,000 paid by government and $500 paid by head of household. The $500 is only 33% of the total cost but it is also 100% of the dependent's share. In addition, the head of household pays over 50% of the dependent parent's other bills, such as credit cards, personal loans, etc. Any thoughts?
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Author: walnutstreet Two stars, 250 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 58919 of 121592
Subject: Re: Head of Household Date: 2/13/2002 3:22 PM
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HI,

Be careful. There are some requirements that you must meet to claim 'Head of Houshold' status.
One of them is dependency. There are five tests to determine dependency and you must meet all five.

Another is 50% of household costs and durations.

Read through the tax booklet about this subject or review publication 17.

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Author: pmarti Big funky green star, 20000 posts Home Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: 58956 of 121592
Subject: Re: Head of Household Date: 2/13/2002 9:22 PM
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Does anyone know about qualifying as a head of household regarding a dependent parent? I know that the rule says the head of household must pay over 50% of the dependent's housing cost, but what if the parent lives in a nursing home? If the governement subsidizes part of the cost, does that count towards the 50%? Example: monthly cost $1,500 with $1,000 paid by government and $500 paid by head of household. The $500 is only 33% of the total cost but it is also 100% of the dependent's share. In addition, the head of household pays over 50% of the dependent parent's other bills, such as credit cards, personal loans, etc.

There are different tests for the qualifying person for HofH filing status and the dependency exemption. It's possible for a parent to qualify as a dependent without being a qualifying person for HofH. There are computation worksheets in IRS Publication 501 to walk you through the different tests.

Given the facts presented, the parent is not a qualifying person for HofH filing status because the filer isn't paying more than half the cost of maintaining the parent's household. Dependency is up in the air, pending resolution of the support test.

Phil Marti

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