Attention parents of young children: Just when you thought you were all done getting Social Security numbers for your children who are five years and older, the rules change.
Beginning with the tax return you file next spring, you will need a Social Security number for all children and dependents who are two years old and older if you wish to claim deductions for them.
The change is the result of the Family Support Act of 1988, which made an effort to further reduce double deductions for children of divorced parents, says KPMG Peat Marwick.
To avoid delays, call your local Social Security office now and request application forms. The forms are easy to fill out and the whole process can be done by mail.
Failure to provide Social Security numbers for dependents on your tax return will cost $5 for each omitted number. In addition, failure to provide a number in response to a follow-up request from the Internal Revenue Service can result in the disallowance of a deduction for each child.