Tax info

Are cadets at USAFA considered active duty for federal income tax?

  • Yes

    Votes: 21 91.3%
  • No

    Votes: 2 8.7%

  • Total voters
    23
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You are a WP parent but you aren't with West Point Parents? :scratch:

#oneteamonefight

And the AFA parents let you linger here???
 
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You are a WP parent but you aren't with West Point Parents? :scratch:

#oneteamonefight

And the AFA parents let you linger here???
I'm with West Point Dads, wife with WP Moms, and both with WP 2020 parents. You know we all root for each other, except when we play each other. I even rooted for the Navy kid on Jeopardy last week.
 
Kinnem, I agree. There is no magical third party that can claim. It is either the parent or the child. And for illustrative purposes, let's take this one step further, into their second year at the academy. Would you still argue that the child is not at all supporting themselves for the full calendar year? Is it OK to continue to claim them the second year? (Aside from the fact that they would not qualify under the residency test, let's ignore that in this scenario, as brovol is solely arguing support.) So based on your logic, you should be able to claim them all four years because the child is not supporting themselves? By virtue of the fact that they are a cadet/mid at an SA, no one else is supporting them, except themselves.
I agree it's the parent or the child in this scenario. I was trying to allude to situation where it's, say, grandma (a third party) and not the parent nor the child. These things happen. But I've made my point and am not arguing with whatever anyone decides to do. I think it's the child in the academy scenario but that's just my opinion after years of doing taxes and sorting through this with when the kid went AD myself.
 
The difference between being a dependent or not is like $4000+, so it's worth getting it right.

$4000 deduction, but only $1000 or less tax difference, depending on your tax bracket.
 
$4000 deduction, but only $1000 or less tax difference, depending on your tax bracket.

My son is attending UT Austin currently (Spring semester 2017). He will be going to the USAFA in late June 2017. After reading everything relevant to 2016, unless there is big changes for this year, there is no chance I will be claiming him as dependent. As you say, it is only a $4050 deduction...or $1025 in tax "savings" if in the 25% tax bracket. Given what I have been paying this past year, I will gladly forego that $1025 to not have another 3 years of tuition, room & board, etc at UT (even after the various college credits out there). Beyond his exemption, his college credits saved my about $2100 this year...but balance that against about $26k per year going forward (tuition, room & board, etc.)

I for one will be GLAD that I cannot claim him as a dependent. It is all good. And even better that this has been his goal since he was 10 years old!
 
Just an FYI for USMA parents - there is a tax office at WP. Cadets can go there and they will assist the cadets with their taxes. This is a free service.
 
The difference between being a dependent or not is like $4000+, so it's worth getting it right.

$4000 deduction, but only $1000 or less tax difference, depending on your tax bracket.

Thanks for clarifying. Good point.

Correct me if I am wrong but aren't we only discussing the tax implication for the Cadet's first year? All other years there is no dispute that they are not dependents of the parent.
 
I think WP and AFA uses "value" as the deciding factor, while the JAG brief at USNA use the "time" to decide:
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If a person did not enter the academy directly from home (e.g. prior enlisted), then they may not be claimed by parents even in their first year.
 
Excellent. Thanks ktnatalk for the information slide.
This lines up with what I have generally read.
 
The academies don't write the tax code. The IRS site answers questions; including what the criteria is to claim a child as a dependent. The two dispositive issues relevant to academy kids would be (1) whether they lived with the parent for at least six months, and (2) has the CHILD paid for more than 50% of his/her own support. The tax code does NOT require that the parents pay for half or more of the child's support as a prerequisite to claiming the child as a dependent. Moreover, the residency requirement provides an exception for full time students and those in the military. Some have suggested that academy students don't qualify under those exceptions, and perhaps they are right, although I have not actually seen any case or other provision which confirms that. Otherwise, the tax code language seems clear and speaks for itself.
 
I dug into this and found IRS Publication 501, Exemptions, Standard Deduction, and Filing Information
In Worksheet 2 there is a support test for a "Qualifying Child" to determine if they are considered a dependent.

The kicker seems to be at line 23 of the worksheet:

Did You Provide More Than Half?
Line 23. Enter the amount others provided for the person's support. Include amounts provided by state, local, and other welfare societies or agencies. Don't include any amounts included on line 1.

Line 23 then gets ADDED to what the child provided for his support, and this then gets tested against the parent's support. I would expect the USAFA to be included under "amounts others provided for the person's support".

I'm no tax guy (just the father of a recently appointed Brutus), but that's what the worksheet says.
 
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I must admit, it's still confusing. Line 23 only gets used (per line 22) if the child needs to be tested as a "qualified relative". If the child meets "other tests to be a qualifying child" you don't look at line 23 and then would not count the Academy's support.

I hate the confusing tax code!!! I have to admit Brovol might have a point!
 
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I must admit, it's still confusing. Line 23 only gets used (per line 22) if the child needs to be tested as a "qualified relative". If the child meets "other tests to be a qualifying child" you don't look at line 23 and then would not count the Academy's support.

I hate the confusing tax code!!! I have to admit Brovol might have a point!
Actually, the actual code is far less confusing if you read it all by itself, and without the comments and conclusions of everyone. The language is clear. The discussion has gone on for awhile, and I haven't seen an authoritative citation which conflicts with the general language I mentioned. The Academies are not authority, even if they were to disagree. Just saying.
 
The information packet we got from the USAFA indicates the parent's support gets compared to TOTAL support provided to the Cadet and it specifically says to include fair value of food, lodging, medical care, education and other services furnished by USAFA.

This contradicts the IRS Pub 501 Worksheet #2 which indicates you should not include support from outside the parent if its a qualifying child. The qualifying child definition gets tested for 5 things (age, support,residency,relationship,joint return).

Time to talk to a CPA or call the IRS. Crazy. At at this point I agree with brovol - the Academies are not the authority and it seems the first year cadet could easily be considered a dependent. It's just surprising to me there is a such a huge contradiction.
 
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As active duty cadets can get TurboTax (Federal and State) for free.

I know it is well beyond normal tax time, but wanted to see how many other USAFA cadets were charged for filing with TurboTax this past year.
Found out from our DD a couple of weeks ago that when she hit the "submit", TurboTax wanted $80 before it would file for her. She said other cadets she knows had the same thing happen. Whatever happened to "free"? It would be cheaper for her to have our CPA file her taxes.
 
I know it is well beyond normal tax time, but wanted to see how many other USAFA cadets were charged for filing with TurboTax this past year.
Found out from our DD a couple of weeks ago that when she hit the "submit", TurboTax wanted $80 before it would file for her. She said other cadets she knows had the same thing happen. Whatever happened to "free"? It would be cheaper for her to have our CPA file her taxes.

This is a keeper:

https://ttlc.intuit.com/questions/2...e-is-no-option-for-cadets-what-should-i-enter


The key is to google "Service Academy Cadets and TurboTax."
 
I know she entered "E-1" for rank. I'm wondering since this rank may not match what is on the W-2 that must be used to confirm military status, if this caused the fee.
 
I know she entered "E-1" for rank. I'm wondering since this rank may not match what is on the W-2 that must be used to confirm military status, if this caused the fee.

Could be, odd.
I texted a few of our USNA sponsor mids. They used the E-1 with no problem, no fee. They used the LES from their DFAS MyPay.

Might be going to the intuit support site, pasting in the asked-and-answered item above and asking why the $80 fee was charged.
 
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