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
I have never once heard of the IRS rejecting a dependent claim that a cadet entering from high school or college that was a legal dependent of their parents the previous year.

You can make it complicated, pay for advice of a CPA/tax advisor/attorney etc or you can rely on precedence that extends back at least to 1979. The precedence is parents can take a full year deduction for for the CY their mid/cadet entered the SA.

If you list E1 on the Intuit based tax forms - they will accept that and make the application free to use. You are not lying - whoever created that question on the form was simply not sophisticated enough to create the Mid/Cadet option. The intent of the question is not to determine income levels but to determine if mid/cadet qualifies for their discount program.

If you really want to cover yourself and you take the deduction, submit a letter with your tax return stating why you took the deduction with a copy of the .ppt slide showing what you relied on for guidance. This will show to the IRS (who is not going to ask to begin with) that you acted in good faith and thus will avoid any penalties (that aren't going to be imposed to begin with because they simply do not care enough to scrutinize your return because you declared a dependent based on what others have done for at least the last 38 years)

What the IRS should be doing is investigating all those children/dependents that disappeared between the last year social security numbers for dependents weren't required and the first year they were required. 1000's if not millions of children seemingly disappeared that year.
 
Any other comments regarding whether a parent is able to claim first year servcie academy students as a dependent. DD is a Firstie at USNA and in 2014, I claimed her because she lived with me 6 months. I used Turbo Tax and don't recall there being a question about her earning more than $4,050. This year, I have a DS (frist year) at USCGA. Again, using Turbo Tax, I responded that he lived with me for 6 months, which is accurate. However, there is a question regarding his income in 2017. Considering 6 months at USCGA, his W2 reflects wages of $6550 so over the $4,050 limit. Responding yes to this question removes his status as my dependent. Considering service academy students earn more than $4,050 even in their first year, that would suggest parents can't claim them at any point once they enter the SA. Seems pretty clear to me but wanted to make sure I am not missing something (grasping at straws here).
 
My son is a West Point and we could not claim him as a dependent once he began at WP. If Turbo Tax allows you to claim your child (who attends a SA), then that is a flaw in their system.

Edited to add - there is one caveat - if you can prove that you spent more on your child than the Service Academy (for example, if you child attended a very, very expensive private school), then you can claim the child. But the Service Academies factor in the cost of tuition, room and board, so most parents spend less than the SAs.
 
Different accountants have reached different conclusions in this matter according to numerous posts and my personal experience.
 
I could not find the current letter but this dated information is the same as I recall reading when DD was a plebe. You can contact the treasurer's office and they can provide the updated letter.

http://www.usma.edu/parents/SiteAssets/SitePages/Resources/TAX MEMO 2012.pdf

Seems like now I remember similar numbers from USAFA for last year - $44K / semester, not year; and even harder amount to claim you spent on your "dependent".

See https://www.usafa.edu/parents/cadet-financial-information/ - the current guidance from USAFA is that cadets provide $32,385 of their own support each semester.
 
Any other comments regarding whether a parent is able to claim first year servcie academy students as a dependent. DD is a Firstie at USNA and in 2014, I claimed her because she lived with me 6 months. I used Turbo Tax and don't recall there being a question about her earning more than $4,050. This year, I have a DS (frist year) at USCGA. Again, using Turbo Tax, I responded that he lived with me for 6 months, which is accurate. However, there is a question regarding his income in 2017. Considering 6 months at USCGA, his W2 reflects wages of $6550 so over the $4,050 limit. Responding yes to this question removes his status as my dependent. Considering service academy students earn more than $4,050 even in their first year, that would suggest parents can't claim them at any point once they enter the SA. Seems pretty clear to me but wanted to make sure I am not missing something (grasping at straws here).

It sounds like Turbotax is taking you down the path for a Qualifying Relative. The Qualifying Relative test compares their gross income for the year against $4050. The Qualifying child test does not.
 
anybody know what the LES paygrade for cadets should be on the turbo tax? there's no C1 and I read somewhere that it is the same as E-5....not sure how reliable the source is
 
anybody know what the LES paygrade for cadets should be on the turbo tax? there's no C1 and I read somewhere that it is the same as E-5....not sure how reliable the source is

I looked at several sources last year and E-5 was the most prevalent answer. The value selected will not impact the calculation of the taxes, but I think it is poor form to use O-x until they have commissioned.
 
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