chip" <chip.wood[at]ieee.org> wrote:

- quote -

You don't tell us how much was reported on the 1099 AZ is
asking about. Without that informaton, there is no way to
tell what should be done.

However, you do tell us enough to indicate a couple of
possible problems. If your MIL's income, not including
social security is greater than the personal exemption, she
does not qualify as your dependent, even if you do provide
more than half of her support.

Secondly, even if she is your dependent, her income goes on
her return. It is not your income and does not belong on
your return.

Lanny K. Williams, CPA
Nawarat, Williams & Co., Ltd.
Income Tax Services for Expatriate Americans

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chip wrote:

- quote -

If she were not required to file a return, whether federal
or state, a simple explanation on the notice and return it
should suffice.

HOWEVER!.... You say you included her income on your
return? It doesn't belong on your return, only on her's IF
she had a filing requirement.

Perhaps you have a case for filing some amended returns for
refunds.

ChEAr$$$$,
Harlan Lunsford, EA n LA

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chip wrote:

- quote -

Why did you include her income in your tax return? It is
her income, not yours.

If she did not need to file, just tell the state DOR that
fact. You would not file amended returns for her if she did
not file in the first place. I think that it might be wise
to consult a tax professional in your town. You might want
to amend your returns and get any refunds that you might
have coming from including her income on your returns. You
have until Monday 17th to file 1040X for 2002. Any year
before that the refund is lost.

Missy Doyle

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chip.wood[at]ieee.org (chip) posted:

- quote -

What? What? You "included her income on _your_ filing?
How did you do that? If you added it to your total income,
you've been overpaying _your_ taxes for all those years.
When someone doesn't have sufficient income to require
filing, they should simply _not_ file. If they are a
dependent, your filing takes credit for them, and their
independent income (which shouldn't exceed $3200 in 2005),
is ignored.

- quote -

Sounds like a routine automated inquiry. She should simply
reply that she had insufficient total income to require
filing, and that ought to close the matter (unless AZ has a
particularly low threshhold for filing state returns).

Bill

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I have a 86 year old mother-in-law that has lived with us
for about 10 years. During that whole time we have paid
well over 50% of her upkeep and have claimed her as a
dependent on our joint returns.

Since she has a very small income from a little pension, SS,
and some stock- approximately $3000, she has not filed for
most of that time. I have included her income on my filing
but never went into the details.

She got a letter from AZ state that for 2001 they received a
1099 from one stock, but don't have a return from her.

Any suggestions? I suppose I could file amended returns
for her for all those years, but she wouldn't pay any taxes
anyway. Is there anyway to avoid the hassle?

Chip

<< ================================================== ===== > << The foregoing is intended for educational purposes only > << and does NOT constitute legal OR professional advice. > << > << The Charter and the Guidelines for submitting > << messages to this newsgroup are at www.asktax.org. > << Copyright (2006) - All rights reserved. > << ================================================== ===== >