I was approved for ssdi in May of 2006. Yesterday my son received back pay from 2006 through august 2008. Will this amount be taxable? Also if a child turns 18 while still in school, do they have to pay taxes on the benefits they receive until they graduate high school?
Yes, I would check with a tax professional. The IRS distinguishes a difference between "earned" income and "unearned" income. "Earned" income is that from a job that one actually earns. Conversely, "unearned" income is income from investments, capital gains, disability income, and etc.
The threshold for paying taxes is lower on unearned income vs earned income. A tax attorney will have the exact cutoffs.
I think I can help you with this one... I also recieved backpay for my child last year. My tax advisor told me yes I do have to pay taxes on MY backpay but not on my child's. My child turned 18 then 3 months later graduated and that didn't change the tax situation.........hope this was helpfull... take -care,
oops forgot to add..........my SS attorney told me that soon I should get some kind of form that I will have to state briefly how I spent the child's backpay ON THE CHILD... aka. food, clothes, new bed, school needs etc.....