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Basic Tax Issues for Seniors and their Families

By Kim Boyer

This article discusses some basic tax issues that seniors and their families face.

Filing Return for an Incapacitated Person. If a taxpayer is unable to manage her affairs over a long period because of physical or mental disability, another person may have to file the tax return. For a joint return, the filing spouse can sign for the disabled spouse by simply signing the disabled spouse’s name and adding “By Husband” or “By Wife” and attaching to the return a statement explaining why the disabled spouse did not sign.

For individual returns, the return must be filed and signed by a duly authorizing agent, such as a guardian or agent under a durable power of attorney. The statute of limitations on the assessment of additional tax does not begin to run on a return filed without a signature or on a return signed by another who is without authority.

Surviving Spouse Filing Joint Return. If a spouse dies, the surviving husband or wife may file a joint return with the decedent for that year, unless the survivor has remarried before the close of that year.

Qualifying Widow or Widower. The surviving spouse may be eligible to file as a qualifying widow or widower and continue to be taxed at joint return rates for up to two (2) taxable years following the taxable year of decedent’s death. To qualify for this benefit, the surviving spouse must (1) maintain as his or her home a household which, for the taxable year, is the principal abode of a dependent son, daughter or step-child for which the survivor is entitled to take a deduction for a personal exemption for that year; (2) not have remarried before the close of the taxable year; and (3) have been entitled to file a joint return for the taxable year in which the spouse dies.

Dependents. An elderly parent with little or no income may be eligible to be claimed as a dependent on an adult child’s return if the parent is a “qualifying relative.” The elderly person loses the exemption for self, but this exemption is probably worth more to the child.

The child may claim the exemption for a parent if (1) the elderly person received over half of his support from the child for the taxable year in question; (2) the parent has a gross income of less than the exemption amount in that year (Social Security or SSI benefits do not count); (3) the parent has not filed a joint return with a spouse; and (4) the parent is an American citizen, resident or national, or resident of Canada or Mexico, for part of the year in question.

The burden is on the taxpayer to prove that the necessary level of support was provided, so adequate recordkeeping is essential. For specific questions, consult a qualified tax professional.

Disclaimer: Information provided as a service of Kim Boyer, Certified Elder Law Attorney, updated as of 03/30/13. It does not constitute legal advice. For specific questions you should consult a qualified attorney.

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