Need to file income tax for MIL?

[countrygirl2]

MIL is 89, gets $1218 SS, VA $1149, and $50 pension, I don't think we need to keep filing

federal or Indiana state income taxes, am I correct? That plus more goes to assisted living for her

care. No we do not contribute enough to take her as a dependent.

[Gardening Grandma]

Is that an annual income of $29004?  Taking those numbers and running them through Taxcaster gave a tax owed of $251. But that is based on no deductions.  She might have deductions greater than the standard deduction.

I think you need to run the numbers through tax software to be on the safe side.

[countrygirl2]

Ok I will, I just thought SS and VA were not taxable, but will double check.

[Gardening Grandma]

Dec 25, 2016 15:01:44 GMT -5 countrygirl2 said:

Ok I will, I just thought SS and VA were not taxable, but will double check.

Dunno about VA
but it appears that 50% of her SS may be taxable,

from tbe IRS website, "file a federal tax return as an "individual" and your combined income* is between $25,000 and $34,000, you may have to pay income tax on up to 50 percent of your benefits."

eta,
a cursory search indicates that her VA benefits may indeed not be taxable.  So are they included in the income calculation for determining whether her SS is partially taxable?

I suggest asking on the Tax Board

[Blonde Granny]

VA disability is not taxable (and that's what I have). Taxable VA income from what I've read depends on the type of payments the spouse receives. So, what does your MIL receive? Is it a VA pension?

[tallguy]

Dec 25, 2016 13:56:29 GMT -5 Gardening Grandma said:

Is that an annual income of $29004?  Taking those numbers and running them through Taxcaster gave a tax owed of $251. But that is based on no deductions.  She might have deductions greater than the standard deduction.

I think you need to run the numbers through tax software to be on the safe side.

If I recall correctly, you only include half of the Social Security benefits when coming up with the combined income total.  If that is the case, it would be $609 SS which would count towards income.

[countrygirl2]

Its considered a va pension, she has as yet to get her back pay while she was waiting.

It's now been over 14 months, I call every couple of months to see the status, it doesn't

seem to be moving, that all at once may trigger something, it will all go to pay her

insurance premiums for 3 years if she gets it. She is down to just a few thousand dollars

now and by the end of the year it will be gone. We buy her clothing, shoes, any extras

now out of pocket, DH buys her insure weekly and that stuff is expensive but it sure helps

her cognitive function, you can tell a big difference when she drinks it.  Her rent raised

$50 a month, holding my breath her insurance doesn't raise or we will be putting in more

money in the next few months. The supplement is $3880 a year and her part B raised too.

She doesn't seem to be declining more, I can see her living 10 more years, she takes no

meds, but doesn't go to the doc either, still she is healthy except for her mind, to bad.

[Value Buy]

Dec 25, 2016 15:01:44 GMT -5 countrygirl2 said:

Ok I will, I just thought SS and VA were not taxable, but will double check.

Indiana does not tax SS, and I do not know about VA

Feds tax a percentage of your SS based on total earnings, but I would think you knew that since you file in Indiana.

[Value Buy]

Speaking of benefits, why would the government continue to pay out benefits to people who only were married to servicemen?
We know this is what is helping to bankrupt private corporate pensions (survivor benefits) as well as the VA and SS.
Veterans who served only four years or so and get disability, I understand, but wives collecting 40 years later, I do not understand, especially if those veterans went on to hold jobs in the private sector after their service.

[Blonde Granny]

As the surviving spouse of someone who served in Vietnam, I couldn't agree more with you VB. My DH died from his service connected disabilities (rated 100% disabled + P & T) permanent & total. I receive $1254.19 per month from a benefit called DIC, which is :

Dependency and Indemnity Compensation - Compensation
benefits.va.gov/compensation/types-dependency_and_indemnity.asp
Jan 8, 2016 - Dependency and Indemnity Compensation (DIC) is a tax free monetary benefit paid to eligible survivors of military Servicemembers who died in the line of duty or eligible survivors of Veterans whose death resulted from a service-related injury or disease.

I pay no taxes, Federal or State. In fact, I don't even have to list it on my tax return.

But all that said, It does tick me off that people suddenly want to file for "free money" from the VA, usually many years after service in the military. These claims are one of the reasons the backlog of VA disability claims continues to grow. Many claims are frivolous and just plain stupid, unfortunately each claim must be worked by a Regional VA office by someone designated as a rater. It's no wonder claims can take years before they are settled. Meanwhile, the claims that are valid will continue to sit undone.

[NoNamePerson]

Dec 26, 2016 8:42:08 GMT -5 Value Buy said:

Speaking of benefits, why would the government continue to pay out benefits to people who only were married to servicemen?
We know this is what is helping to bankrupt private corporate pensions (survivor benefits) as well as the VA and SS.
Veterans who served only four years or so and get disability, I understand, but wives collecting 40 years later, I do not understand, especially if those veterans went on to hold jobs in the private sector after their service.

My mother was still receiving DIC (from VA)  when she died in 1996. My father was KIA in 1944. She never remarried so she drew it till her death. I remember a time when if you remarried you lost it but I think that changed to where you could draw it again under some circumstances but can't remember the exact details.

The VA also paid for me to go to college - well I guess up to a certain amount - I was young and don't remember all the details except tuition, room and board (dorm) and meals in cafeteria were covered. Wonder if they still do that for dependents of KIA service men/women today? 

[NoNamePerson]

Blonde Granny you and I were posting at the same time. I thought there was someone on the board who got DIC but couldn't remember who. I remember thinking you were the first person other than my mother that I had ever heard say they received it. Just not something that comes up often.

Oh countrygirl2 was a tax return filed last year? Unless no one has been filing all these years maybe look at prior yr returns to see. I know my mother's DIC wasn't taxable in the two states she lived in over the years but not same state as your MIL so no help there.

[Blonde Granny]

Yes they do NNP, it's called Chapter 35. Since my DH was rated at 100% P & T IF we would have had children they would have gone to college with the VA paying the bills.

There is also another benefit that I have, it's ChampVA. It is a no cost to dependents of service person who have a 100% PT disability. For me, it becomes secondary to Medicare and acts as a supplement, ChampVA also covers my medication by a program called medsby mail. If I would have to buy an RX locally I pay 25% of the cost. My meds are sent to me by a VA medical Center located in Georgia.

There are far more benefits, but since I don't qualify for them I don't recall what they are. I do know that now, they have lifted the remarriage part of the law, so if I would do something stupid like get married again I would retain my tax exemptions, but only if I remain in the house I'm in. This benefit does not transfer to a new house. Personal property exemption stays if I buy a new car, as does the DV (disabled veteran) license plate that costs me about $2.95 each year for a new plate.

As far as state benefits for KIA and/or 100% P & T, it varies by state. Arkansas is quite generous, as I pay no real estate taxes on my home or any personal property taxes.

[countrygirl2]

I have been filing her returns each year, we had to as she was getting rental income from the 10

acres, but we bought that, will use it and rent for her if we have to and pay taxes on it ourselves.

Actually the income from it just pays the property taxes on it and the small house, but that's ok,

nets out.

I have been reading and its seems to be a difference between an actual veteran who is disabled

and his spouse. I will pick up a turbo tax program, I imagine it is covered in that and no SS is

not taxed in Indiana, I'm guessing VA isn't either, we shall see. If it isn't filed Indiana will come

after the estate, she has no estate so no issue there. But I want it to be right.

DD does not have to file a return but since she now gets more SS from her dad I will no longer

take her as a dependent, we could but not doing that either, again just want it to be correct.

[Value Buy]

Dec 26, 2016 9:15:01 GMT -5 NoNamePerson said:

Dec 26, 2016 8:42:08 GMT -5 Value Buy said:

Speaking of benefits, why would the government continue to pay out benefits to people who only were married to servicemen?
We know this is what is helping to bankrupt private corporate pensions (survivor benefits) as well as the VA and SS.
Veterans who served only four years or so and get disability, I understand, but wives collecting 40 years later, I do not understand, especially if those veterans went on to hold jobs in the private sector after their service.

My mother was still receiving DIC (from VA)  when she died in 1996. My father was KIA in 1944. She never remarried so she drew it till her death. I remember a time when if you remarried you lost it but I think that changed to where you could draw it again under some circumstances but can't remember the exact details.

The VA also paid for me to go to college - well I guess up to a certain amount - I was young and don't remember all the details except tuition, room and board (dorm) and meals in cafeteria were covered. Wonder if they still do that for dependents of KIA service men/women today? 

I have NO problem with survivors of a person KIA from receiving any and all disability/survivor benefits. Any veteran with a 75 to 100% disability, I have no problem with family getting anything they have coming....
There are many veterans who have a partial disability that does not prevent them from working regular jobs, making good money in the private sector and still getting insurance and monthly disability checks.
My fil had a foot injury from the Korean war, received the monthly check and still made big money in the private sector.
One of my coworkers injured his thumb on the job in Korea in the fifties and cashed the check every month, and made more money than I did. He kept the government insurance rather than the company insurance, but in his case, his job was not impacted by by the military injury.
Throw in all the mental anguish cases we see now, and the whole thing is a mess, but I understand we have to take care of our veterans. Wives, fourty years after service where veterans are not 100% disabled are another story, imo.
Country girl, this is not a "shot" at your mother inlaw. It is a shot at the system in place.

[countrygirl2]

I don't know, I didn't even know she was eligible for something like that. They only are if the spouse served in actual war time, not otherwise. We were wondering how we could pay for this over extended years and in reading I found the benefit, I imagine a lot never know about it.  There is also an asset test you have to have less the $80k in assets, when MIL got it it was a 2 year look back, they just changed it to 5. We still didn't think she could get it because she owned her house and small farm with 10 acres.  We thought there was a life estate so we were going to buy SIL out, they were in my husbands and brothers name.  We went to the attorney to buy it out from former SIL and found out he and my husband had owned it jointly since 1992.  So we bought half out, the lady did not even own her house, she still doesn't realize it!  We use the little from her mom's old house toward her expenses and when hubby gets her house done and rented most of that money will go for her insurance till she ever gets back  That will pay her insurance for 3 years then we are paying it too.  But if she lives a long time rents will have to go to her expenses because it will keep raising we figured this would work best as we could maintain income for her for a long time and not bankrupt us.  I think she could easily live 10 more years.  Eventually when she goes to a nursing home she will go on Medicaid and lose VA.  I am eligible but would never get it because of the asset test. However, unless the law is changed out DD can. You also cannot get a VA benefit and Medicaid also so there are a lot of stipulations. I think it is basically so veterans and their widows won't end up on the street or their disabled child.

But yes I understand what you are saying.

[Value Buy]

Thanks for the explanation.