Post # 1
In 2009 I basically supported my parents. Bought them a house, making sure bills are paid, etc. My dad gets SS and my mom JUST started a part-time job around mid-December.
Back when my mom was working, she signed for a student loan for my younger sister and subsequently lost her job and was unable to pay back the student loan. My parents don’t have any income to garnish but they didn’t receive the stimulus payment this summer b/c it was taken due to the student loan.
That’s the background…now for the question. If I claim my parents as dependents when I file my taxes this year, will any refund I am expecting be garnished/seized to apply to the unpaid student loan??
I plan to ask the tax preparer before filing but I figure that the hives is so full of bees somebody is bound to have an answer for me.
Post # 3
No, that would still go on their tax return. Even if they don’t file, they will find something else to garnish because your refund isn’t eligible. If they are required to file a tax return because they made enough income ($5,700 if neither of them is over 65 or $6,800 if they are over 65), income the garnishment will come from their return and you can’t claim them. You do know that you can only claim your parents if they made less than $3,650 in a year and you provide more than half their support right? (I’m a tax accountant.)
Post # 4
@MissAsB….I KNEW the hive would come through
My parents only source of income is my dad’s Social Security which I don’t think counts towards the $3650? Please do correct me if I’m wrong b/c I don’t want to tangle with the IRS. My mom has only worked 12 days in December and has been part-time at a little more than minimum wage. My dad is 78 years old and his income other than social security is zero (0)….so I think I am good to go as far as that.
I was mainly concerned about the student loan and possibly having my tax refund garnished. My parents haven’t been filing taxes b/c they didn’t have any income other than social security. Since I have been supporting them outside of SS starting in March of 2009, this will be my first time claiming them on my taxes. I want to make sure I don’t make any mistakes.
Post # 5
I’m not completely sure if it doesn’t count toward that or not but if that was their only income, they definetly won’t owe any taxes. I would check with the CPA to be sure. I’ve never had someone who was on Social Security and a dependant so I don’t want to give you the wrong info! But you definetely don’t have to worry about them taking your tax return, they might go into your parent’s bank account or garnish your mother’s wages though.
Post # 6
Thanks for the info!! It is GREATLY appreciated.