Taxes: be careful, deducting child support from an adult child is not always possible

Seven out of ten young people aged 18 to 24, and 90% of students, receive regular financial assistance from their parents, according to the National Institute for Statistics and Economic Studies (Insee, 2016). Whether in the form of a direct payment of money or a participation in the payment of their expenses – rent, transport or communication costs, leisure activities, etc.

When their children are no longer attached to their tax household, parents can take this assistance into account when calculating their income tax, by deducting the sums in question from their taxable income as alimony. This payment need not have been provided for by a court decision.

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The pension is deductible regardless of the age of the beneficiary child, whether he is just 20 years old or double! It does not matter whether he cohabits with them, either single or in a couple, or whether he has dependent children. Maximum amount: 5,959 euros per year for an unmarried child, 11,918 euros for an unmarried child with one or more dependent children or for a couple.

But this deduction is only allowed if the child is ” in need “, that is, if its resources do not allow it to cope on its own. Otherwise, the tax administration is entitled to refuse the deduction of the sums in question.

By monthly transfer

This notion of need is subjective and depends, to a certain extent, on the social and family situation of the child. The state of need is generally recognized when the child is a student, looking for his first job, or unemployed.

To assess whether he is in fact in need, all of his resources are taken into account, including the aid he receives and unemployment benefits. In general, when he has income, judges generally compare their level with that of the minimum wage.

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In a recent case, the tax authorities refused to deduct a pension paid by parents to their son on the grounds that he was not in need.

The parents had also given him accommodation, which had considerably reduced his fixed costs.

And the judges (Douai Administrative Court of Appeal, May 6, 2021) ruled in favor, although the child received for the year in question income lower than the minimum wage in force. The reason ? The parents had also given him, in April of the same year, a home in which he lived, which had considerably reduced his fixed costs.

In addition to the state of need of their child, parents must be able to prove the reality of the help given to their children. Even if they have no supporting documents to provide when filing the declaration, the tax authorities are entitled to ask them for it. Also, if they regularly give money to their child, it will be in their interest to do so by monthly transfer, so that they can present their account statements.

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In practice, insofar as the deductible amount is capped, you just need to provide proof of payments reaching this limit.

If your child has lived with you all year, the tax authorities allow you to deduct a lump sum of 3,542 euros for an unmarried child or 7,084 euros for a couple or a single person with a child, without having to provide supporting documents. to be provided, to cover your accommodation and food costs. Other expenses remain deductible for their actual and justified amount, up to a limit of 2,417 euros (5,959 – 3,542) or 4,834 euros (11,918 – 784) for a couple or a single person with a child.

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