"MTW" <mtwingcpa[at]yahoo.com> wrote:
- quote -

I'm not an expert on Medicaid. My guess is that it was set
up so that the wealth of other family members doesn't have
to be used up to qualify. But that doesn't mean the kids
can't be held responsible under the proper circumstances,
though admittedly it rarely happens.

Stu

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Stuart A. Bronstein wrote:
(snipped)

- quote -

Now that's interesting, Stu. I'd never heard of that
before. Since you mention many, if not all, states. where
do you reckon I could check such a list if one exists?

Of course in this day and age, not every set of children and
parents even live in the same state. So.. how would that
work? Reckon I can "depend" on my daughter in Florida when
I'm old and grey?

ChEAr$,
Harlan Lunsford, EA n LA

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Rick Merrill wrote:
- quote -

Well I sure HOPE that nobody takes you seriously on that
answer. It just ain't so.

ChEAr$,
Harlan Lunsford, EA n LA
Sun 20 Mar 2005

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- quote -

How about looking at this from a slightly different angle.
On audit, what documentation is required to sustain a
mortgage (or for that matter real estate tax) deduction
assuming the IRS wants to push the issue as hard as they
can? Is it sufficient to show that the amount was owed by
the tax payer and that it was paid (say, by statements from
the bank or locality) or would it also be necessary to
somehow show a matching debit from the tax payer's funds?

Dan Lanciani
ddl[at]danlan.*com

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Stuart A. Bronstein wrote:

- quote -

Really? Then how does that interact with Medicaid?

MTW

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Mark Rigotti, CPA wrote:
- quote -

If the church gives you a receipt, you can deduct that total
regardless of who wrote the check.

Moderator:
I live across the street from a large church and walk
through their parking lot to get to physical therapy.
Yesterday I stopped in to meet the new pastor. Damn,
I should have asked him for a reciept for $10,000 so
I could deduct it. Boy, did I blow that one!

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"Mark Rigotti, CPA" <rigotti[at]wideopenwest.com> wrote:
- quote -

That sounds similar to the practice of making a donation in
someone else's name, perhaps in lieu of a birthday present.
In that case, who gets the deduction?

Stu

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"Stuart A. Bronstein" <spamtrap[at]lexregia.com> wrote:
- quote -

Stu,

Let's see my dad made charitable donations to our church.
Since he can't itemize he put tem under my envelope #. Can
I now deduct them? I did not write the check.

--
Regards,

Mark Rigotti

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Rick Merrill wrote:
- quote -

I'm pretty sure that Stu was asking a rhetorical question,
for we know the answer is that one cannot deduct such a
payment unless (1) he actually pays it and (2) he is on the
hook for it.

Now I'm wondering, what does the figure 10,000 have to do
with anything.

Wait; dont' tell me. I'll figure it out by tomorrow.

ChEAr$,
Harlan Lunsford, EA n LA
Sun 13 Mar 2005

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"A.G. Kalman" <glendale202-mtm[at]yahoo.com> wrote:
- quote -

Which reminds me of one more thing:

In many (if not all) states, children have the legal
obligation to provide for their parents, if the parents
can't provide for themselves. Just as parents have to
provide for their children. My understanding is that legally
required support payments are not considered to be taxable
gifts.

Stu

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- quote -

The difference is that when the son gives the money to
his mother, she can choose to spend it however she
wants, i.e. it is her money.

At a meta-level, it's the tax code, it doesn't have
to make sense. For example (this example has been
blessed by the great EdZ in the dim mists of the past :-)

Scenario A:
* Deposit $10,000 in a checking account.
* Buy $10,000 stock in a brokerage account.
* Write a $5,000 check to the brokerage account
to cover the initial margin requirement.
* Use the remaining $5,000 in the checking account
to buy a home theater setup.

Scenario B:
* Deposit $10,000 in a brokerage account.
* Buy $10,000 stock in that account.
* Take out a $5,000 margin loan to buy the
home theater setup.

In both scenarios, you finish with $10,000 of stock, a
$5,000 debt, no cash, and a home theater setup. However,
only in scenario A is the interest on the margin loan
deductible.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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Stuart A. Bronstein wrote:
- quote -

The difference is that he did not do that. OP says that HE
paid.

ChEAr$,
Harlan Lunsford, EA n LA
Sat 12 Mar 2005

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Stuart A. Bronstein wrote:
- quote -

If everyone started to make payments for everyone else, the
tax authorities would never know whether or not a payment
was a gift, support payment or a direct expense. If the son
wants to help his mother and she has a tax obligation that
can benefit from a tax deduction, he ought to gift her the
money and let her make the payments. As long as the annual
gifts to his mother stay under the $11K limit, he would not
have to file a gift tax return.

--
Alan
http://taxtopics.net

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Stuart A. Bronstein wrote:
- quote -

Right on, Stu. The mother can take the tax deduction. (let's
hope the total did not exceed 10,000!)

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"Mark Rigotti, CPA" <rigotti[at]wideopenwest.com> wrote:
- quote -

Why is that different from the son giving his mother the
money, and then her making the payments? Seems to me it
should be treated the same way.

Stu

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stevejdufour[at]yahoo.com wrote:

- quote -

Since you're a "tax pro", and working for an outfit like
HRB, it's incumbent upon them to be your "be all and know
all". Not trying to evade your question, but shouldn't you
first ask your supervisor? I mean, this is their client
and in their best interests to make sure the correct law is
applied.

ChEAr$,
Harlan Lunsford, EA n LA
Tue 8 Mar 2005

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stevejdufour[at]yahoo.com wrote:

- quote -

No he can't take a deduction. However, it is possible that
he may be able to file as head of household and he may be
able to claim her as a dependent. See IRS Pub 501 for more
details. http://www.irs.gov/publications/index.html

--
Alan
http://taxtopics.net

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Only if he is legally responsible for paying the mortgage.
If not, he may give her the money and have her pay the
mortgage and deduct the interest from *her* return.

Missy Doyle

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stevejdufour[at]yahoo.com wrote:

- quote -

Nope. And because she didn't pay it, neither can she.

I sincerely hope you have reference material available to
you at work, so that you can answer that kind of question.
A Master Tax Guide would be a good place to start, although
it's not definitive.

Phoebe

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stevejdufour[at]yahoo.com writes:

- quote -

Technically he can't. To get the deduction, one has to be
both legally liable for the loan and make the payment. So
in this case no-one gets the deduction. Mom doesn't get it
because she didn't pay and son doesn't get it because he's
not liable for the loan.

Consider advising the son to instead give Mom the money and
let Mom make the payment herself. That way she can at least
get the deduction.

--
Rich Carreiro rlcarr[at]animato.arlington.ma.us

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