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socrateaser
socrateaser, Lawyer
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Hello, I have received the head of household audit letter

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Hello,

I have received the head of household audit letter from CA Franchise Tax Board and have some questions before replying back to them by Monday 11/22.
Franchise tax board is reviewing my 2009 CA income tax return to determine if I am qualified to use the head of household (HOH) filing status.

Before replying, I need to be certain 100%, if I am actually qualified to use the head of household.

I have filed HOH for my mother who is disabled and receives SSI. Also, my mother has in home support services in a total of 283 hours monthly which is not enough to provide 24/7 in home care which my mom requires. My mother does not live with me in the same unit but I have used HOH for her.

Please help me to determine, if I am qualified and what kind of a letter, if any, should be attached along with the questionnaire form received from CA Franchise Tax Board.
Unless your mother had less than $3,650 in gross income during 2009, then you cannot file as HOH. To determine the taxable portion of your mother's SSI, see the worksheet, in the instructions for IRS form 1040, page 28.

I'm guessing that you do not qualify. Assuming that you do not, then all you can do is inform the FTB that you made a clerical error when you originally filed, and request that they waive any penalties.

Hope this helps.

Hello,

 

If your mother is on SSI (Supplemental Security Income) it is not taxable. If she is on Social Security Disability, then some of the income may be taxable IF she has additional income. If she has no taxable income, then she will meet the income portion of the rules to be your dependent. The next step is to determine the cost of her support. If say it costs $30,000 per year for housing, food, medical, clothing, transportation, etc., and you pay more than half of this amount, then she will be your dependent, and you may claim Head of Household status. I suspect that if you provide this information to FSB, it will clear this up.

 

Please let me know if I can help you further.

 

Thank You,

 

 

Jacy

My colleague is correct re SSI, but I strongly disagree with his advice. The reason why I provided the worksheet is because it is impossible to figure out your mother's financial situation without your revealing it in this public forum. However, you can make the calculations for yourself and determine whether or not you can qualify for HOH status.

Do not be mislead into believing that you can easily mollify the California Franchise Tax Board. The FTB is extremely adversarial -- perhaps even more so than the IRS. You must get your facts straight or you will lose this little contest.

Hope this helps.

Edited by socrateaser on 11/21/2010 at 8:20 PM EST
socrateaser, Lawyer
Category: Tax
Satisfied Customers: 37957
Experience: Retired (mostly)
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Customer: replied 6 years ago.

Hello,

I have one more questions related to Head of Household qualification. If my mom does not live with me but lives in the government subsidized apartment, can I still claim myself as a head of household?

 

 

Thanks

To determine whether you have provided more than half the support for a person, compare the amount you contributed for the person's support to the entire amount of support the person received from all sources. All sources include tax-exempt income such as social security and welfare benefits, as well as the person's own funds. Your contribution may not include any part of the person's support that was paid by the person with the person's own wages, even if you paid the wages. The person's own funds are not support unless they are actually spent for support.

Amounts paid by government to subsidize housing costs must be added to the total amount of support from other sources and compared against the support paid by you. The result must be that you have paid more support during the tax year, in order to qualify for HOH.

Hope this helps.

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