<p>Do other parents let their kids handle paying bills once they are in apartments? Not putting the money in the bank—just physically paying the bill.</p>
<p>if you can trust him to not blow the money, I think you are doing the right thing.</p>
<p>We put the money into the bank accounts. Kids handled paying the bills. Both lived in off campus housing where one roomie did the rent, another the cable, another the utilities. Our kids were in charge of getting the money to the right person ON TIME. We did our part by making the deposit on time.</p>
<p>We also made it abundantly clear that money for living expenses HAD TO BE USED for living expenses. If bills were not paid, they could expect to come home to live (and for both that would have meant changing schools).</p>
<p>I think it’s a good idea. Good preparation for later in life. :)</p>
<p>Our theory was that if they chose to live off-campus in a house, they could certainly figure out how to pay the bills. This year we are not even doling the housing money out monthly…S1 got a semester’s worth, lump sum in his account in August. His name is on the lease and at least some of the utilities and so he has responsibility for those mundane household tasks like paying bills.</p>
<p>We deposited a set amount to S’s bank account at the beginning of each semester based on posted dorm room and full board costs at his college for that year. He was completely responsible for how that money was applied to pay his share of the bills for his apartment. Because his apartment was practically on campus and expensive, our payments did not cover the full cost so he did have a job as well.</p>
<p>Mathson signed the lease and pays the bills, but we do give him the money for the rent.</p>
<p>S is in an on campus apartment so the “rent” is part of the bill that we pay. However we do send him a sum once a month for “expenses”. He can do with it as he wishes but if he spends it all on the first week then meals could be a bit dicey for the rest of the month.</p>
<p>Our kid’s name is on the lease…not ours. We didn’t even see it before she signed it. If the bill doesn’t get paid, she will have an issue!!</p>
<p>Well, I asked this because I was bowled over by the parents of my son’s roomates handling the rent payment for their kids. Maybe they’re doing internet, too. I’m just so disappointed in them and almost feel pressured into taking over this chore from my son, though I haven’t yet. I have two older ones and I never even SAW their leases, or paid one bill. This is not just one set of parents, but three, and they are amazing to me. To me, this is such a great easy step toward adult responsibilities and kids feel good about themselves when they do these things. </p>
<p>I’m so glad to hear I am not crazy though. Thanks.</p>
<p>We always gave our kids their money by the term and expected them to learn to pay bills-rent, tuition, books, utilities, etc. It is a necessary learning experience.</p>
<p>We handled the rent payment for S1’s sophomore year. We sent the check to the landlord. My son was subletting, there were 3 other guys that we didn’t know and our son’s name wasn’t on the lease. We were glad we did it this way as it was abit of a mess at the end of the lease, but we had established the terms with his landlord from day one. We are landlords so saw the writing on the wall at the beginning. This year, he writes the checks, etc. We deposit the rent into his account each month and sporadically give him some money for food. He signed the lease. He pays his own utilities, internet, buys his own books, food, etc. out of his earnings from a part-time job. All is good.</p>
<p>In general I agree that the kids should be paying their own bills, rent included. </p>
<p>But, I must confess, I am currently paying my son’s rent for him. Not because he wouldn’t be perfectly responsible and pay it on time but because my accountant wanted me to in order to have a clear traceability of support. </p>
<p>Apparently she had a client get audited last year and the IRS rejected that client’s claim that a college student was a dependent since the student was paying their bills out of an account that was strictly in their name (a former UTMA account). As a result, she is going through all of her clients who have kids older than 18 declared as dependents and making sure that there is a clear line of support from the parents to the kid, in excess of 50% of the kid’s living expenses. </p>
<p>I am not suggesting that this is happening in all of the cases cited above - but it is one reason why a parent might be paying the rent.</p>
<p>We also paid directly DS’s grad school rent for the same reason as SCUalum. Needed to show evidence that we were paying more than 50% of his support. BUT we deposited the money for expenses into HIS account and he took care of that. For undergrad…the kids both paid the rent themselves from the money we deposited. Believe me…in BOTH cases, their tuition bills alone showed we were providing more than 50% of their support!!</p>
<p>Depending on the specific lease, a parent may also end up being a co guarantor. Some 'rents may want to be sure the rent is paid so as not to adversely affect their own credit. </p>
<p>It can also be an issue if the kid has a tendency to blow through money. </p>
<p>There may be valid reasons for a scenario that may appear as helicoptering.</p>
<p>I guess it depends on the kid, and it depends on the situation. Both my kids are currently in on-campus housing, so we pay the school at the beginning of each semester. I never thought to have them make the semester payment. So, if they moved to off-campus housing, I don’t know why that would be any different…If I was going to pay the bill while “on campus,” why wouldn’t I pay if they were “off-campus”. </p>
<p>I can see doing things differently once they were in grad school, but maybe not if I had to demonstrate dependancy for tax purposes and health insurance purposes.</p>
<p>If you were depositing or transferring the money into the students account I can’t imagine it would be too difficult to prove to the IRS that the student were dependent. The health insurance is dependent on their enrollment in college and not necessarily the housing situation.</p>
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<p>I think you you are right, those other parents are wrong. My parents sent me a monthly check, and I paid all bills from that, including rent, from the time I was 17 years old. I also established credit cards under my own name & paid them directly, paid my own car insurance, etc. The amount of money my parents sent me monthly was adequate but sparse – I had to learn how to budget carefully as well. My ex-husband’s parents paid his rent and simply gave him use of their credit card all the way through law school. This ultimately was a huge problem in our marriage – he simply did not know how to handle money. </p>
<p>I expected my kids to handle their own finances once they were in college - also, unlike my situation, I do NOT send a monthly check. My deal with my d. is that I pay the bill from the college bursar, she pays everything else (books, food, clothing, incidentals). My daughter’s school requires her to live on campus, so I am paying her housing – but she has paid her own rent during summers, as she has lived on her own for various jobs, internships or travel. </p>
<p>I don’t know about the IRS thing – I’m assuming that my payments to the bursar would document everything. Also, since we rely on financial aid and the FAFSA forces me to treat my under-23 undergrad as a dependent, no matter what … I’d definitely go to the mat with IRS if they tried to impose a different standard. I’m wondering if that CPA’s audited client was paying for an older college student (a grad student or an undergrad who was age 24+ ) — or perhaps the audit was triggered when the child filed a tax return inconsistent with the dependency claim. One good reason for a parent to “help” with the dependent kid’s tax return - I have had my daughter do her own return, because I also want her to learn how to do that - but I also check it before submitted, so I’d catch it if she didn’t check the box about being a dependent on someone else’s return.</p>
<p>Calmom:</p>
<p>The issue with the IRS came about because the parents put money into an UTMA account rather than a 529 - trying to do the right thing and save for college… </p>
<p>With an UTMA account, when the kid turns 18 (age varies in some states), the money is his/hers. It is their asset. With a 529, the money is in your name - and therefore considered yours for support purposes.</p>
<p>My son’s case is somewhat tricky. My wife and I put money into a 529 - but my inlaws used an UTMA, not bothering to tell anyone. So on his 18th birthday - surprise he has a nice chunk of change in his name. To make matters more complicated, as he chases his athletic dreams, he is going to a CA JuCo - with tuition of less than $30 a unit. So the main part of his support is room and board - payments to the college are trivial in the total scheme of things.</p>
<p>So we pay his rent out of the 529 - direct to the landlord. He uses the UTMA money and his paycheck for food and tuition - and we add things up very carefully at the end of the year. Basically he pays all of his own bills other than rent. </p>
<p>And yes - my accountant does his taxes - having him do them himself would be insane given the fine line we are walking.</p>
<p>Scualum – while I would agree that you should follow the advice of your accountant – I’d think that if you sent a monthly or quarterly checks to your son – or even directly transferred money to him – it should be enough to document that you are supporting him with IRS, assuming your payments are enough to reasonably meet 50% or more of basic living expenses for a young adult. In other words I think that your CPA is being overly cautious. </p>
<p>I don’t mean to criticize your decision to follow his advice in any way. It sounds like you are raising your son to be very responsible. You also mentioned your son’s paycheck – I do think that if he is earning a significant amount that could raise a problem with IRS. I don’t think IRS would assume that anyone is living off their savings, but if a young adult is earning more than $10K a year (for example), they might feel that he is earning enough to pay more than half his living expenses.</p>
<p>I’m only offering my opinion in the context of this thread – for other parents who are considering the impact of the choice in terms of fostering independence in their kids. I think it is a more of a record-keeping issue than one of necessity.</p>