Claiming someone as a dependent can reduce your tax bill. At the very least, you’ll get a dependent exemption that cuts your taxable income. You might be eligible for the Child Tax Credit, Child and Dependent Care Credit, a bigger Earned Income Credit and other tax breaks. With all these possibilities, just one dependent may save you thousands on taxes. Before you can claim a dependent, however, the person has to meet Internal Revenue Service tests as a qualifying relative or child.
A child has to be related to you in some way to be qualified as a dependent. Biological children count, of course. So do stepchildren and adopted children. If you take a foster child into your home, you can claim her as a dependent. Your brothers and sisters may be qualified children if they meet other IRS tests. Descendents of anybody who falls into one of these categories can also be a dependent. For example, a grandchild or nephew may be a qualifying child.
Normally, a child must be age 18 or younger at the end of the year to be a qualified child, although there are two exceptions. The age limit is 23 or younger when the child is a full-time student and there is no age restriction for children with permanent disabilities. A child may furnish no more than 50 percent of his own support. As a rule, a child must live with you for more than half the year. This residency requirement may be waived when parents are divorced or separated and doesn’t apply to infants born during the year. Also, a temporary absence like attending school doesn’t count against the residency requirement.
Some relatives who are not qualifying children may be claimed as dependents. In general, this means a parent or other direct ancestor such as a grandparent. Aunts or uncles and their offspring may be eligible as dependents under the qualifying relative test. In addition, someone who lives with you for the entire year as a member of your family might be qualified. For anybody to be claimed as a qualifying relative, her own income has to be less than $3,800 and you have to provide more than half of her income.
Who Isn't Eligible
You can’t claim anyone as a dependent when someone claims you as a dependent. Also, you can’t claim someone as a defendant who is claimed by someone else. You can’t claim someone as a dependent who is not a United States citizen, U.S. national, resident alien or a resident of Mexico or Canada. Finally, someone who is married and files a joint return can’t be claimed as a dependent. This restriction is waived if the return is filed only to get a refund from the IRS.
- IRS: A “Qualifying Child”
- IRS: Exemptions, Standard Deduction, and Filing Information
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- IRS. "Tax Tutorial Module 4: Dependents." Accessed June 16, 2020.
- IRS. "Publication 501 (2018), Dependents, Standard Deduction, and Filing Information." Accessed June 16, 2020.
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- IRS. "Qualifying Child of More Than One Person." Accessed June 16, 2020.
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- IRS. "Table 2: Qualifying Relative Dependents." Page 1. Accessed June 16, 2020.
- IRS. "Form 2120, Multiple Support Declaration." Accessed June 16, 2020.
- IRS. "Answers to Frequently Asked Questions for Registered Domestic Partners and Individuals in Civil Unions." Accessed June 16, 2020.
- IRS. "Dependents 3." Accessed April 7, 2020.
- IRS. "IRS Provides Tax Inflation Adjustments for Tax Year 2019." Accessed June 16, 2020.
Based in Atlanta, Georgia, W D Adkins has been writing professionally since 2008. He writes about business, personal finance and careers. Adkins holds master's degrees in history and sociology from Georgia State University. He became a member of the Society of Professional Journalists in 2009.