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Tax Breaks for Boomerang Kids
by Kevin McCormally

Divorced or widowed parents may get some help from Uncle Sam if a single child returns home -- after college, say, or following a divorce.

If you were single at the end of last year and paid more than half the cost of maintaining a home where you lived with your unmarried child, you may be able to file as a head of household rather than as a single taxpayer. This gets you a bigger standard deduction and lower tax rates. Combined, that can save about $1,500 in taxes if your income is around $50,000.

Usually, to qualify as a head of household, you must be providing a home for a person who is your dependent. And, generally, anyone who made more than $3,050 in 2003 can't qualify as a dependent.

But when your single child is involved, the dependency test doesn't matter. So, no matter how much your son or daughter made, you might still qualify for the head of household tax break. Check it out.