Can I claim my grandparents as dependents?

May 29, 2002

From:  Melissa
Date:  Thu, 3 Jan 2002

I read your reply on claiming parents as dependents. I would like to claim my grandparents as dependents. I meet all the criteria of the 5 tests, but am finding it hard to prove. My grandparents' house is paid off and is still in their name. All the bills come in their name, so it is just easier for me to continue paying the bills under their name instead of changing everything over into my name. The only income they have is social security and my grandfather has a pension. Neither one will be filing. Can I claim them?

Sincerely,
Melissa

Answer

Date:  January 2002

Hello Melissa,

First, remember under the income test, your dependent may not have taxable gross income more than the exemption amount, or $2,900 for 2001. If your grandfather has a community-property pension of $6,000, your grandparents don't qualify as dependents.

Also, since your grandparents are living in their own home, they are considered to having contributed the fair rental value of the home for the year, less any amounts you pay for upkeep, for their own support. This, plus any amounts they spend from your grandfather's pension and their social security for support items could result in your failing the support test.

Otherwise, I suggest that you keep a separate checking account and credit cards for items that you pay for your grandparents to prove you meet the test of providing more than half of their support. If you can document you paid these items for 2001 and meet the other tests, including the income and support tests, you can claim them.

Good luck!
Mike Gray

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