23 Nov When Several Different People Provide Support IRS Form 2120 – Multiple Support Declaration
It seems that more and more children are providing support to parents living on fixed income. Quite often several brothers and sisters collectively are providing support and when this collective support exceeds 1/2 of the parents living expenses if the parents are subsisting on little more than social security benefits one of the children should consider listing the parents who are considered qualifying relatives as dependents to take advantage of the dependency exemption.
This is done via IRS Form 2120 – Multiple Support Declaration which is used to:
● Identify each other eligible person who paid over 10% of the support of your qualifying relative whom you are claiming as a dependent, and
● Indicate that you have a signed statement from each other eligible person waiving his or her right to claim that person as a dependent
An eligible person is someone who could have claimed a person as a dependent except that he or she did not pay over half of that person’s support. If there are more than four other eligible persons, attach a statement to your return with the required information.
Generally, to claim a person as a qualifying relative, you must pay over half of that person’s support. However, even if you did not meet this support test, you may be able to claim him or her as a dependent if all five of the following apply.
1. You and one or more other eligible person(s) together paid over half of that person’s support.
2. You paid over 10% of the support.
3. No one alone paid over half of that person’s support.
4. The other dependency tests are met.
5. Each other eligible person who paid over 10% of the support agrees not to claim that person as a dependent by giving you a
signed statement.
To find out what is included in support, see IRS Pub. 501, Exemptions, Standard Deduction, and Filing Information.
You must have received, from each other eligible person listed above, a signed statement waiving his or her right to claim the person as a dependent for the calendar year indicated on this form.
The statement must include:
● The calendar year the waiver applies to,
● The name of your qualifying relative the eligible person helped to support, and
● The eligible person’s name, address, and social security number.
Do not file the signed statement with your return. But you must keep it for your records and be prepared to furnish it and any other information necessary to show that you qualify to claim the person as your dependent.
For more on this contact me anytime at your convenience.