<p>I’d run the scenario both ways and see which one gives the bigger benefit. If the “rent” qualifies the child for more SSI would the tax on that rent to the parents be more or less? Because I definitely think you could look at it either way so it would not be wrong to do it either way. If it’s legitimately rent, then call it that and pay the tax. If it’s shared expenses, then don’t claim it. But the bigger question is which is more financially beneficial. </p>
<p>Wow, younghoss. Im the OP and I actually agree with the content of your posts though not the tone.
As EK4 indicated, our adult disabled daughter COULD have been living in a supported apartment since turning 18 and legally becoming our responsibility no more. She would have been collecting those higher SSI payments from you and me, the taxpayers, for the last 7 years. Instead, we allowed her to live eith us rent free. Our choice.
As we now see she may live with us even longer than anticipated, we’re looking into financial assistance TO WHICH SHE IS LEGALLY ENTITLED, to help her continue to live with us. Never any intention to defraud the systems in place, just investigating appropriate options. We’re old, not getting any younger, and our resources are not unlimited.</p>
<p>Thank you all for helping me clarify this situation.
3bm103, your post is very helpful.
Anyone dealing with family members with special needs knows this is one of many. </p>
<p>I KNOW that there are typical adult kids living “long term” for whatever reason in parents home.
My original post was to ask those parents if they charge rent and do they declare as income.
Seems like families decide to consider money from kids as shared expenses or toward utilities or such.
So, i’ve gotten my answer. It just isnt applicable in our family’s circumstances.
Thats OK, i posted to learn!</p>
<p>I think you should be talking to a tax lawyer about your specific situation. However well-meaning, the opinions of those of us who aren’t in the situation of overseeing a disabled adult who receives SSI aren’t worth anything, and may be misleading. Best of wishes to you. </p>
<p>Are you this adult’s legal guardian? I know a case where the parents were assigned guardianship of the child on the child’s 18th birthday, because the now-adult was forfeiting certain rights (I remember the right to vote was one of them). This was a young woman who was profoundly intellectually disabled and would never be able to live independently or be employed. I don’t know if that would change things for tax purposes. </p>
<p>Pizzagirl, yes, my DH and I are the legal guardians for our adult daughter.
She is intellectually disabled, but has good functional life skills.
The guardianship, in NJ at least, does not and has not prevented her from voting.
Guardianship does not affect the SSI/tax situation.</p>
<p>We will seek professional advice for our special circumstances, was only seeking feedback here for the general question of tax treatment of rent collected from adult children. I veered off into our specifics in response to some poster’s questions, so discussion became unnecessarily complicated. Thats the way it goes on forums, i get that!</p>
<p>If you are legal guardians, I don’t believe you can have her sign a lease contract. If you are guardians over both person and property, then she probably is not deemed competent to sign a legal document. </p>
<p>It would be insane for you to have to put her rent money on your taxes. Maybe if you were taking a huge writeoff for her care, because if you didn’t the cost to the taxpayers would be far larger than her SSI payment. No doubt the cost of her food, utilities, living expenses, are an additional expense for you. Many people are actually getting payments from the government as a home health care aide, for a loved one. It’s a win/win scenario. I think it would be so wrong to have to get taxed for what you provide for your child. I’ll bet that nobody here declares what their child gives them as rent on their taxes, and you shouldn’t either.</p>
<p>My sister has a disabled child that just qualiifed for ssi. She has to have limited assets so my sister charges her for items that in fact my sister pays so that she can never go over the asset limit. I believe my sister has a trust set up for future care. It is a very difficult situation having to protect a disabled child for when the parents are no longer alive.</p>
<p>I appreciate the support here. I love that there’s a specific thread recently started for parents of disabled children. Ive learned alot there. We’ve had to learn step by step over the last 25 years how to advocate for our daughter. The challenges dont go away, they just evolve.</p>
<p>We’re looking ahead to when we will be gone. There are steps we’ve already taken, such as setting up a special needs trust. Managing her SS benefits are also one piece. Housing is a huge one.</p>
<p>Again, thanks for the thoughtful responses.</p>
<p>Sorry to the Op you don’t like what you interpret as my “tone”. I gave my opinion on the business angle of what I feel should happen if this young adult would claim having paid rent in order to receive higher funding. I believe that is what the Op asked about. However, I did add that in my personal opinion, it is rightfully so that a disabled person paying rent should get more than a disabled person not paying rent. Should I not have added the personal part of my opinion?</p>
<p>" I gave my opinion on the business angle of what I feel should happen if this young adult would claim having paid rent in order to receive higher funding. I believe that is what the Op asked about."</p>
<p>The problem is, you are equating rent from a rental property (that no doubt you are getting many tax writeoffs from— depreciation, utilities, maybe claiming losses), with a personal home. The child should be considered a renter if you are declaring the property as your rental property and taking rental losses. I’m sure you wouldn’t get all the same writeoffs, nor would you declare what your child paid you as rent if they were in your vacation home, or your personal home.</p>
<p>People don’t declare what their child gives them towards rent and housing expenses as income. Sure, maybe if we could declare what we have spent towards their upkeep for the last couple of decades as a tax loss (and that would be one massive writeoff), but when they pay a little bit towards their actual expenses, that is not income.</p>
<p>Younghoss, the only question in my original post was:
“If we collect (modest) rent from her, must we report it as income on our return?
What have you done?” (Sorry, i dont know how to do the quote thing.)</p>
<p>The conversation did veer off later. The increased SSI is a red herring; the source of the childs rent is not the point.
I was looking for feedback on how parents handled rent paid to them. Your response was clear and i agree with it.
But as you can see, others do not and the IRS web info is confusing also.
We will have to get professional advice, this forum is great but not con lusive, obviously.</p>
<p>And no, we would not be claiming deductions for renting a room to our child, so no depreciation, expenses, etc on our return.</p>
<p>“And no, we would not be claiming deductions for renting a room to our child, so no depreciation, expenses, etc on our return”</p>
<p>Yes, I’m sure you wouldn’t. And I don’t think anyone else here is doing that either. Totally different situation for people who are renting to their kids in a rental house, and claiming deductions.</p>
<p>This doesn’t have anything to do with taxes, butI want to say that for as long as you can, I think you are doing the right thing.</p>
<p>I know a couple who have a disabled daughter who will never be able to live by herself, but the toll of caring for her was really wearing on the parents and they needed more help so they turned her care over to the state although they do have a trust for her to supplement her care.
However, since they are no longer her guardians, they do not have final say about her living conditions and her health has deteriorated. Those who end up caring for the disabled are undertrained, and overworked, and it is heartbreaking to see my friend worry so much about her child and not able to make a big enough difference to reverse the decline.</p>
<p>It’s heartbreaking for me too as she is a lively & warm young woman and deserves better.</p>
<p>EK4, thanks. What you described, and not rent or tax returns, is what keeps me up at night.
Should we find a reasonable housing placement now, while we are still here to monitor and support her dmotionally through the transition? Or wait as long as possible and risk that she has her housing stability disrupted at the same time as she has to deal with our passings?
We’re running the middle ground for now…she is on housing waitlists around the county. Meanwhile she does continue to mature and learn in her day programs and supported workshop. It almost more difficult for us to see the correct path for her because she has many strengths and interests and lives a vibrant life despite her challenges.
At 25 yrs old, she has a boyfriend, with all that might entail. That definetely keeps me awake!</p>
<p>If you don’t mind me asking, what sort of disabilities does your daughter have? </p>
<p>PG, our daughter has been delayed since birth, first recognized as inability to walk at 18 months, followed by language delays.
She attended early intervention from 2 years old, great programs in school district then special needs out of district school till age 21. No specific syndrome on genetic testing; not autistic.
Her diagnosis is the generic “intellectually disabled”, new improved version of MR. Poor IQ.</p>
<p>She is now a VERY verbal, social young woman. Reads at functional level, uses a laptop for games and basic email, loves needlepoint, rainbow loom, biking and is an ecellent dancer!
But she cannot drive, prepare food except basic sandwiches, handle cash reliably, or somehow remember that yes, its time to take a shower, again. No planning functions at all.
Hope this isnt TMI.</p>
<p>We collect “rent” from our 22-year-old son who has schizophrenia. He gets $721 a month SSI this way, instead of $480. I don’t feel bad about this AT ALL. If we weren’t monitoring him 24/7, he would be in an institution. Period. Instead, he is close to getting his bachelor’s degree in applied math and has at least a chance of becoming a mathematician and getting off SSI entirely. WE NEED SOME HELP. If you haven’t been in our shoes, you have NO IDEA how devastating and expensive it is. Unbelievable. We paid tens of thousands of dollars for his care before he was approved for disability. My parents even helped us out with expenses. Even now, I have a pit in my stomach 24/7, wondering what will become of our son. The mental health care system in this country is irrevocably broken, I’m afraid.</p>
<p>@musicmom
Can you clarify…is this truly rent or is some/most of it for food, toiletries, and other expenses? </p>
<p>It is scary how few options there are to provide for the many who can’t live independently but are over 18 years old. I know others grappling with this issue and have not heard any easy answers. </p>