A) The income that needs to be reported if grown children with income reside with a 66 year old parent on Medicare and receiving Social Security Survivors Benefits depends on the specific circumstances. In general, the following income must be reported:
- The parent’s income, including Social Security Survivors Benefits, retirement benefits, and any other income they receive.
- The income of any children who live with the parent and are not considered independent under Social Security rules. This includes income from wages, self-employment, investments, and any other sources.
If the children are considered independent, their income does not need to be reported. However, if the parent is claiming a dependent care credit, the income of any children who are under the age of 13 and not in school full-time must be reported.
It is important to note that the rules for reporting income can be complex, and it is always best to consult with a Social Security representative if you have any questions.
Here are some additional things to keep in mind:
- The income that needs to be reported may change if the parent’s circumstances change. For example, if the parent gets a job or their spouse dies, their income may increase and they may need to report more income.
- If the parent is not sure what income needs to be reported, they can contact Social Security for assistance.
- The parent should keep records of all their income, including Social Security benefits, wages, and self-employment income. This will help them to accurately report their income to Social Security.
Here are some additional general guidelines that may help you:
- If the grown children have their own income from work or other sources, they should report it on their own tax returns. They do not need to report it to the Social Security Administration (SSA) or the Marketplace, unless they are receiving Social Security benefits themselves or applying for health coverage through the Marketplace.
- If the parent claims the grown children as dependents on their tax return, the parent should include their income in the household income calculation for the Marketplace application. This may affect the parent’s eligibility for premium tax credits or cost-sharing reductions for health coverage. The parent does not need to report the dependent children’s income to the SSA, unless the parent or the children are receiving Social Security benefits based on the parent’s work record.
- If the grown children receive Social Security benefits based on the parent’s work record, such as survivor’s benefits or disability benefits, they should report their benefits and any other income to the SSA and the IRS. The SSA will use their income to determine if their benefits are taxable or subject to reduction. The IRS will use their income to determine if they need to file a tax return and if any of their benefits are taxable. The grown children should also report their benefits and any other income to the Marketplace if they apply for health coverage through the Marketplace.