Claiming a Dependent on Your Tax Return
A tax dependent is a child or relative whose characteristics and relationship to you qualify you for tax benefits such as head of household filing status, the Child Tax Credit, the Earned Income Tax Credit, or the Child and Dependent Care Credit. It can be difficult to tell if someone is a tax dependent. Here's a quick rundown, but keep in mind that this is a complicated area of the tax code with plenty of exceptions.
For tax purposes, there are two kinds of dependents:
- Qualified child
- An eligible relative
A child must meet all of the following criteria to be claimed as a dependent on your tax return.
The youngster must be a member of your family ( Your son, daughter, stepchild, foster child, brother, sister, half brother, half-sister, stepbrother, stepsister, or a descendant of any of those people must be the child)
He or she must be under a specified age limit.
At the conclusion of the year, the child was 18 or younger, and younger than you or your spouse (if you're married and filing jointly).
At the conclusion of the year, the child was 23 or younger, a student, and younger than you or your spouse (if you're married and filing jointly). In this situation, "student" indicates the child was enrolled full-time for at least five months of the year.
The child is older than these age ranges, but a doctor has determined that he or she is permanently and fully incapacitated.
The youngster is required to reside with you (This is where the residency test comes in. The youngster must have spent more than half of the tax year with you) -- Temporary absences (such as if the child was away at college, in the hospital, or juvenile detention), children born or died during the tax year, children of divorced or separated parents, and kidnapped children are all exempt.
The youngster cannot sustain himself or herself financially for more than half of the time.
The youngster is unable to submit a joint tax return with another person.
The custodial parent usually gets to claim the child as a dependent in the event of a divorce or separation. However, if the custodial parent provides a formal declaration that he or she will not claim the child as a dependent, the noncustodial parent may be able to claim the child as a dependent.
You can't claim your child as a tax dependent if she gets a job and supports herself at least half of the time. However, household expenses such as rent, groceries, electricity, clothing, unreimbursed medical expenses, travel costs, and recreation expenses are often covered by assistance.
The joint return test is what it's called. If the kid and the child's spouse file a combined return solely to claim a refund of income tax withheld or anticipated tax paid, there is an exception.
A relative who qualifies can be of any age. However, in order to claim a relative as a tax dependent on your tax return, they must meet all of the following criteria.
The individual cannot be an eligible child of someone else (You can't claim the qualifying child of someone else as a qualifying relative. So, if your child lives with your parents and fits all of the criteria to be their qualifying child, you can't claim him as a qualified relative as well).
The person must be a relative or reside with you.
One of these relationships exists between you and the individual. He or she is your child, stepchild, legally adopted child, foster child, or a descendant of any of those people (for example, your grandchild), or is your sibling, half-sibling, stepsibling, niece, or nephew (including half siblings' children), or is your parent or grandparent, stepparent, aunt or uncle, or in-law (but not your foster parent).
The person spent the entire year with you. There are exceptions for temporary absences (such as when a child is away at college), children born or dying within the tax year, and children under the age of 18.
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