During your annual tax preparation meeting, Mary announced that she will be moving into her own apartment during the next year. As you congratulated her, she indicated that her father was not very happy about losing his deductions. When questioned about this statement, Mary indicated that her father had been claiming them (Mary and Livvie) as his dependents. Additional Background: Mary, 24, is a single mother who cares for her 4 year old daughter, Livvie. Mary sporadically receives small monthly payments from Livvie’s father to help with costs for Livvie’s care. Livvie doesn’t spend any time with her Father. Mary is an independent contractor and earns income of $9,000 from tutoring college students. Mary lives with her parents and pays them a fair amount each month for rent. Mary has been saving her income so that she can move into her own apartment with Livvie. Mary has paid for Livvie’s clothing, food, and has taken Livvie on vacation trips to Disney and other kid friendly resorts. Mary’s parents, Livvie’s grandparents have been spoiling their granddaughter with toys and presents and have taken care of Livvie when Mary is working. Your Task Research the rules concerning dependents, and determine who has the right to make a claim for dependents during the past tax year (Mary or her parents). State your assumptions and identify the issues that must be resolved. What should be the firm’s position in this matter?. As you congratulated her, she indicated that her father was not very happy about losing his deductions. When questioned about this statement, Mary indicated that her father had been claiming them (Mary and Livvie) as his dependents. Additional Background: Mary, 24, is a single mother who cares for her 4 year old daughter, Livvie. Mary sporadically receives small monthly payments from Livvie’s father to help with costs for Livvie’s care. Livvie doesn’t spend any time with her Father. Mary is an independent contractor and earns income of $9,000 from tutoring college students. Mary lives with her parents and pays them a fair amount each month for rent. Mary has been saving her income so that she can move into her own apartment with Livvie. Mary has paid for Livvie’s clothing, food, and has taken Livvie on vacation trips to Disney and other kid friendly resorts. Mary’s parents, Livvie’s grandparents have been spoiling their granddaughter with toys and presents and have taken care of Livvie when Mary is working. Your Task Research the rules concerning dependents, and determine who has the right to make a claim for dependents during the past tax year (Mary or her parents). State your assumptions and identify the issues that must be resolved. What should be the firm’s position in this matter?
During your annual tax preparation meeting, Mary announced that she will be moving into her own apartment during
the next year. As you congratulated her, she indicated that her father was not very happy about losing his deductions.
When questioned about this statement, Mary indicated that her father had been claiming them (Mary and Livvie) as his dependents.
Additional Background:
Mary, 24, is a single mother who cares for her 4 year old daughter, Livvie. Mary sporadically receives small monthly payments from Livvie’s father to help with costs for Livvie’s care. Livvie doesn’t spend any time with her Father.
Mary is an independent contractor and earns income of $9,000 from tutoring college students. Mary lives with her parents and pays them a fair amount each month for rent. Mary has been saving her income so that she can move into her own apartment with Livvie. Mary has paid for Livvie’s clothing, food, and has taken Livvie on vacation trips to Disney and other kid friendly resorts.
Mary’s parents, Livvie’s grandparents have been spoiling their granddaughter with toys and presents and have taken care of Livvie when Mary is working.Your Task
Research the rules concerning dependents, and determine who has the right to make a claim for dependents during the past tax year (Mary or her parents). State your assumptions and identify the issues that must be resolved.
What should be the firm’s position in this matter?
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