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Are there any downsides to adding parent as a dependent for head of household deductions and HSA?

Forum|Forum|5 years ago
April 25, 2021
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My elderly father lives with me at my residence. He has about $3500 in investment income and social security. I pay for his out-of-pocket medical bills and living expenses. According to the IRS, this seems to meet the requirements for the total support test.

Publication 501 (2020), Dependents, Standard Deduction, and Filing Information | Internal Revenue Service (irs.gov)

I would like to consider having him file as my dependent. That will also enable me to use my HSA account for his medical expenses (which are significant, but not greater than 7.5% of my income).

Are there any downsides to adding him as my dependent with me filing as the head of household? Can this be changed in future years?

Best answer by ColeenD3

Yes, he qualifies as your dependent. There is no downside to claiming him, except for him not receiving possible future stimulus amounts. Yes, the can be determined on a yearly basis.

ColeenD3Answer

Yes, he qualifies as your dependent. There is no downside to claiming him, except for him not receiving possible future stimulus amounts. Yes, the can be determined on a yearly basis.