IRS and Phony Dependents

Your editorial reported on how Social Security numbers required for dependents “eliminated” 7 million of them on tax returns filed for 1987. The potential for other tax scams is encouraged because Form 1040 does not show information regarding the age of the taxpayer(s) and dependents. Many tax benefits are triggered by the age of the taxpayer. For example:

1. Taxpayers 65 and over may claim additional standard deduction if they do not itemize deductions.

2. Taxpayers 55 and over at time of sale of personal residence may claim exclusion from tax of the first $125,000 profit.

3. Taxpayers get special treatment if they withdraw retirement pension funds after age 59 1/2 without penalty.

4. A dependent taxpayer who is a full-time student and over 23, with more than $2,000 in earnings, may claim exemption on 1040.

5. Parents may include in their tax return earnings of children under age 13 under certain conditions.

The IRS cannot determine the age qualification of any of the above taxpayers from the current forms. The solution is very simple. Every taxpayer and dependent must report their age on the forms.

Bottom line is that the voluntary system of reporting one’s income, deductions and exemptions permits too many taxpayers to stretch their imagination.

JOSEPH L. WEISS

Los Angeles