Thinking of filing, question about household size/income

[poormomto4]

Hi,
We may have to file. My dh makes over the median income but while checking the online means test samples I think we can qualify for a ch. 7.

My questions are about my 18yo son. He just finished highschool this year and is currently working full time though he will be a full time student in the fall. We claimed him on our income tax so he is included in our household number, right? We don't have to count his income on our filing do we? He doesn't contribute anything.

[MomIcantFindmy]

That would be a lawyer question but I would suspect you do have to count his income. Our daughter was turning 18 in July so we filed in April just in case. You can however count him in your household size as he is living with you.

An attorney may have some suggestions (I don't even know if it is legal) but maybe you could draw up a lease contract with him and have him pay a certain amount of rent then you do not count him or his money in your household, just the rent. Just a suggestion off the top of my head...might not be a good one.

[lrprn]

My questions are about my 18yo son. He just finished highschool this year and is currently working full time though he will be a full time student in the fall.

What matters is if he is living in your household at least 50% of the time. Is he? Is he planning to go to college away from home in the fall? Are you filing before he leaves for school or moves out to an apartment (if he is leaving)?

We claimed him on our income tax so he is included in our household number, right?

Family size is not determined by who claims who on your taxes. If you contribute more than 50% towards his support, then you are usually entitled to claim him as a family member when you file. This is a good question to ask during your 3-4 local bk lawyer interviews to see how this situation has been treated in your local court before now.

We don't have to count his income on our filing do we? He doesn't contribute anything.

If he lives in your home and you count him as a family member when you file but he does not contribute anything to the running of the household, then you will count his income into the six-month lookback period but will subtract it out in full later on the bk forms. It all evens out on the Means Test in the long run.

[Flamingo]

Your son is part of your household and his income is part of your household income. And since you claim him you still enjoy the exemption and his income is taking away what you normally would provide to him as to items he would purchase, etc. You will be asked about other income in your household. Advise what you son has made and advise about his situation. Do not hold any information back inasmuch as you claim your son as a dependent.

[poormomto4]

Thanks, I think.

He isn't leaving to go to school so he will be living at home. I'm still not sure how we will pay for school because we definitely don't qualify for aide.

I'm not sure what you mean about including and then subtracting later. We're at the very beginning stages and just trying to see the possibilities. I need to gather more information for my husband before he will consider even speaking to an attorney.

[AngelinaCatHub]

Wow, this is a good question. On one hand, you may keep him as a dependent while in school until he becomes 24 by IRS. On the other hand, he is 18 and a legal adult, and if I remember when I was 18, what I made I spent on myself, nothing I spent, my parents would have given me so, I did not add to their wealth. If the parents did not receive in hand currency, the son did not contribute to the income of the family. He spent it on his own as an individual. I can’t see how they need to list it as part of income. Actually he takes from the household income as he uses hot water, electricity, food, and is an expense. Interesting question. Keep us informed on this one. ‘Hub

[poormomto4]

That is the way I see it too but I wanted to check and it will be a question for the attorneys when/if we get that far. We get nothing from him. Actually we still provide food, he uses utilities, we provide clothing, etc. He spends his money on his car and his girlfriend. We will be paying for school too though I'm not sure how yet.

[Flamingo]

He should be able to apply and obtain Stafford Loans and if you are claiming him as a dependent and you file for BK, that works to his advantage (our own attorney told us that cause we filed when our daughter entered 9th grade).

Go review irs.gov and look up what encompasses a household for household income. If he earns income, he has to file a tax return and claim zero because you are claiming him as a dependent (supplying over 50% of his support for the year in which he is claimed). He is a member of your household, earning income over and above what you and your husband earn so it is household income. Your attorney can clear this up for you. He will show on your taxes as a dependent and his taxes will show that he is claimed as a dependent. So you have to list him and his income as part of the household and income.

I know it gets complicated but been there and through it. Thankfully we were discharged before my daughter started earning more than several hundred dollars through the summer months.