Show What is a tax dependent?A tax dependent is a child or relative whose characteristics and relationship to you allow you to claim certain tax deductions and credits, such as head of household filing status, the child tax credit, the earned income tax credit or the child and dependent care credit. Determining whether someone is a tax dependent can be difficult. Here’s a rundown, but keep in mind that this is a complex area of the tax code and there are exceptions to every rule. For all the details, check out IRS Publication 501. Who qualifies as a tax dependentFor tax purposes, there are two kinds of dependents:
Qualifying childTo claim a child as a dependent on your tax return, the child must meet all of the following conditions. The child has to be part of your familyThis is the relationship test. The child must be your son, daughter, stepchild, foster child, brother, sister, half brother, half sister, stepbrother, stepsister or a descendant of any of those people. The child has to be under a certain ageThis is the age test. One of these three things has to be true to pass this test:
The child has to live with youThis is the residency test. The child must have lived with you for more than half the tax year. There are certain exceptions for temporary absences (such as if the child was away at college, in the hospital or in juvenile detention), for children who were born or died during the tax year, for kids of divorced or separated parents and for kidnapped kids. In cases of divorce or separation, the custodial parent typically gets to claim the child as a dependent. However, sometimes the noncustodial parent can claim a child as a dependent if the custodial parent signs a written declaration that he or she won’t claim the child as a dependent. The child can't provide more than half of his or her own financial supportIf your child gets a job and provides at least half of her own financial support, you can’t claim the child as a tax dependent. However, support generally includes household expenses such as rent, groceries, utilities, clothing, unreimbursed medical expenses, travel costs and recreation expenses. The child can’t file a joint tax return with someoneThis is the joint return test. There’s an exception here if the child and the child's spouse file a joint return only to claim a refund of income tax withheld or estimated tax paid. The child has to have a certain residency or citizenship statusThis is the citizen or resident test. The child has to be a U.S. citizen, U.S. resident alien, U.S. national or a resident of Canada or Mexico. Qualifying relativeA qualifying relative can be any age. But to claim a relative as a tax dependent on your tax return, the person must meet all of the following conditions. The person can’t be anyone else’s qualifying childYou can’t claim someone else’s qualifying child as your qualifying relative. So if your toddler lives with your parents, for example, and he meets all the tests to be their qualifying child, you can’t also claim him as your qualifying relative. The person has to be related to you or live with youOnly one of these two things has to be true:
Note that only one of the two things has to be true in order to get over the hurdle. That means that a person related to you doesn’t necessarily have to live with you in order for you to claim them as a dependent. This can be especially important for people supporting elderly parents who live somewhere else. The person’s gross income is below the limitThe person’s gross income for the year can’t be more than $4,300 in the 2021 tax year ($4,400 in 2022). People who are disabled or have income from a sheltered workshop get an exception. Gross income includes money from rental properties, business income and taxable unemployment and Social Security benefits. You have to provide more than half the person’s total financial support for the yearSupport generally includes household expenses such as rent, groceries, utilities, clothing, unreimbursed medical expenses, travel costs and recreation expenses. If multiple people provide support for a person and because of that no one person is providing more than 50% of the support, the support providers can sign a Multiple Support Declaration designating who gets to claim the supported person as their tax dependent. Find more ways to secure your assets and your future
Who is not a tax dependentThese people generally won’t count as your tax dependents:
Tax breaks for claiming a tax dependentClaiming a dependent can get you some big tax breaks. Good tax software, including providers who participate in IRS Free File, should ask you questions that will help determine whether you qualify.
What qualifies someone as a dependent?To claim your child as your dependent, your child must meet either the qualifying child test or the qualifying relative test: To meet the qualifying child test, your child must be younger than you and either younger than 19 years old or be a "student" younger than 24 years old as of the end of the calendar year.
WHO classifies as a dependent on taxes?For tax year 2022, the Child Tax Credit is up to $2,000. The Credit for Other Dependents is worth up to $500. The IRS defines a dependent as a qualifying child (under age 19 or under 24 if a full-time student, or any age if permanently and totally disabled) or a qualifying relative.
|