not sure which is true or what to do

[nicole_1005]

ty
..................................

 

[nagol818]

Ummm. Stupid question here. Sorry for my ignorance. What is the "buy out method" on taxes?

 

[LdiJ]

If they live together and he proves it, the state will cut her assistance.

Maybe....she already has child support on record. Depends on their incomes.

 

[LdiJ]

Ummm. Stupid question here. Sorry for my ignorance. What is the "buy out method" on taxes?

It just means that she shares the tax return with him. It means that whoever would get the bigger return shares with the other.

Let me give you a "non-related example"...because that might be easier to understand.

A parent is legally able to claim their child because their child is a full time student, and living either at home or at school... even though working. However, the child wants to claim themselves and get a refund or higher refund. Legally the parent is the one entitled to the exemption due to the full time student status....however the IRS would be unlikely to object if the parent didn't claim the child.

Now, lets say that the parent's refund would be 1500.00 higher claiming the child, but the child's refund would be only 300.00 higher claiming themselves.

The parent claims the child and gives the child 300.00 of their refund. That is a "buy out".

Same thing applies here. Lets say that mom qualifies for EIC, and perhaps the additional child tax credit and would get a 4k refund. Dad would get a 1k refund due to the child. Mom claims the child (which is totally legal and is in fact proper)...and gives dad 1k.

In both of those scenarios....either the parent or mom....they are 100% legally entitled to claim the child and could legitimately leave the other parent or the child out. They wouldn't owe them a penny. However in the sake of "family unity"...or "detente"...they share.