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MrWoodster
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« on: February 01, 2012, 12:46:10 PM » |
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My father has completed his first full year of receiving Aid & Attendance benefits.
Unfortunately, it's tax time again. Are these benefits fully taxable under the current
federal tax code as income? Yah, I know, what am I thinking.
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MrWoodster
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« Reply #1 on: February 01, 2012, 01:03:45 PM » |
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I should have reviewed all the articles on the internet before I put another
question on this forum. All the research I have done to date indicates that
these benefits are not taxable and should not be added to the recipents
gross income in tax reporting. It says this everywhere.
Does anyone else have anthing different.
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MrWoodster
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« Reply #2 on: February 01, 2012, 01:06:43 PM » |
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VA disability benefits: Do not include disability benefits you receive from the Department of Veterans Affairs (VA) in your gross income. If you are a military retiree and do not receive your disability benefits from the VA, see Publication 525 for more information.
Do not include in your income any veterans' benefits paid under any law, regulation, or administrative practice administered by the VA. These include: Education, training, and subsistence allowances.
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Patches01
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« Reply #3 on: February 17, 2012, 09:31:47 AM » |
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Gotta love the tax season! From what I have read here and IRS, The veteran's A & A pension is not countable income as seen by IRS. Any checks that are paid to a caregiver is taxable. It is the responsibility of the caregiver to claim it as earned income. I had a lovely time at H & R Block yesterday doing Dad's and my taxes (2 hours). I am crossing my fingers to the outcome, H & R Block stated that no 1099 was needed from my father...P.S. Paid the extra $, just in case IRS wants and audit, H & R will have to pay up, if done wrong!  |
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MrWoodster
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« Reply #4 on: February 24, 2012, 08:56:49 PM » |
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I've been all over the place with this tax question, and to date, the below paragraph seems to address any and all benefits received from the V.A. and states that they are not taxable.
Veterans' Benefits Not Taxable
As veterans prepare their income tax returns, they will NOT want to include in their income any veterans' benefits paid under any law, regulation or administrative practice administered by the Department of Veterans Affairs (VA). These non-taxable benefits include education, training and subsistence allowances; disability compensation and pension payments for disabilities; grants for homes designed for wheelchair living; grants for motor vehicles for veterans who lost their sight or the use of their limbs; veterans' insurance proceeds and dividends; benefits under a dependent-care assistance program; and payments made under the compensated work therapy program. Tax information for members of the military is available on the IRS website.
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vetadmin
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« Reply #5 on: February 24, 2012, 09:55:13 PM » |
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This pension IS NOT taxable income.
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DaddysGirl
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« Reply #6 on: February 25, 2012, 03:06:06 AM » |
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Attention all Caregivers:
Yes, the pension is not taxable to the Veteran who is receiving the benefit, however it is considered taxable to a paid Caregiver.
If you are the paid Caregiver, you must report your earnings to the IRS! If you don't report it, they will find you.
Likewise, if you are collecting unemployment, you must report all of your earnings to the Department of Employment Security. I am looking a little closer into this.
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helpingmyparents
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« Reply #7 on: February 26, 2012, 02:45:14 PM » |
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I would definitely report the income if you are the caregiver. There are ways to report it without the 1099. I would be too afraid of the IRS finding out if you do not...and that it may have some consequence on the pension itself. If you get enough money, you may need to pay estimated taxes throughout the year. If you do not prepay and owe over a certain amount when you file, there is a penalty from the IRS. I am new at the caregiver part, but I have been doing this self-employment thing for a decade or so.  |
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vetadmin
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« Reply #8 on: February 26, 2012, 03:09:58 PM » |
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Not sure where the confusion has come in here, but this is no different that if you had a job some place else. If you earn income, you owe taxes.
The Veteran or widow does not pay taxes on the pension. The caregiver is not entitled to a pass on this, and yes, the IRS works very closely with the VA, and there will be issues if you don't claim the income you are being compensated for.
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DaddysGirl
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« Reply #9 on: February 28, 2012, 12:43:41 AM » |
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Has anyone successfuly lowered their quarterly taxes from caregiving by investing in their IRA on a quarterly basis?
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