Taxes: When Your Dependent Child Receives SSI Disability
As If Filing Your Taxes Wasn't Complicated Enough
Figuring out how to calculate your taxes can be very challenging, even with the help of a tax professional. If your dependent child collects unearned income from government benefits such as Supplemental Security Income (SSI), figuring out what to claim on your tax return may be even more confusing. Fortunately, the Social Security Administration and the Internal Revenue Service have gone to great lengths to set up simple guidelines that help you file your taxes when your child receives SSI disability benefits.
What Are Supplemental Security Insurance Benefits?
SSI payments are monthly cash benefits the US government pays to disabled individuals. If you don't meet the work history requirements for Social Security Disability Insurance, but you have a qualifying disability, you will be eligible to receive SSI benefits instead.
SSI benefits are based on your total household income, and the Social Security Administration determines the amount of your monthly benefits at the start of each year. You receive the same amount each month for the full year. The majority of people receiving SSI are disabled children, or adults who became disabled as children. Other recipients include disabled legal immigrants or other adults who don't meet the work requisites.
Does My Dependent Child Have to Pay Taxes on SSI Benefits?
It depends on whether they received other income or not.
- If your child earned income with a part-time job, then at least some of his or her SSI benefits may be subject to tax liability. This is also the case if during the year, your child received some other type of income, such as payments from a trust fund or an inheritance. How much of your child's SSI taxes are subject to a tax liability depends on how much the child earned through his other income sources.
- If SSI was your child's sole source of income, he or she does not have to file a tax return and his benefits aren't taxed. This is generally true of most government benefits and entitlement programs: if they're the recipient's only income, then the recipient doesn't have to pay any taxes on them.
Do I Claim My Child's SSI Benefits on My Taxes?
You can't claim your child's SSI benefits on your taxes, simply because it's not your income. Even if your child is very young, the government has no age limits for tax and income liability. If your child is receiving SSI benefits, the government counts that as your child's income, not yours. You can't claim it as income, and you aren't responsible for paying any taxes on it.
Can I Claim my Child as a Dependent if They Received SSI?
You can still claim your child as a dependent on your taxes even if she received SSI benefits, if he met any of the following conditions:
- Your child was 19 years of age or younger at the end of the tax year;
- The child is 24 years of age or younger and going to school full-time;
- The child is permanently and totally disabled, regardless of how old he is.
To claim a child who receives SSI as your dependent, ensure that if he or she files their own tax return they check the box next to "If someone can claim you as a dependent, check the box below." If your child who receives SSI will not file a tax return this year, you don't have to do anything. You can claim your child as a dependent even if he or she receives SSI benefits.
What About Child Support?
Child support payments can make filing your taxes even more confusing if the child for which you receive support also receives SSI. The Social Security Administration counts a portion of the total monthly child support your child receives as the child's income when calculating her SSI benefits.
Taxes are a slightly different matter. Child support is considered tax-neutral. Neither the recipient (your child), nor you, nor the absent parent paying the child support may claim child support payments on a tax return. Receiving child support won't affect your child's tax liability with her SSI benefits.
- Center for Law and Social Policy: SSI and Child Support Information
- Child Support Payments and the SSI Program
- Are Social Security Disability Benefits Taxable?
- Social Security Administration:What You Need To Know When You Get Supplemental Security Income (SSI)
- IRS.gov: Six Important Facts about Dependents and Exemptions