Tax Questions on How to Prove Dependents Lived With You

In common parlance, a dependent is typically considered to be one’s child. However, the IRS defines a dependent slightly differently and has developed tests to determine who qualifies as a tax dependent. One of the components of these tests is whether a dependent lived with you. Accordingly, rules have been developed regarding dependents living with an individual, which will determine whether they qualify as dependents for the IRS.

A dependent for IRS purposes must be a qualifying child or a qualifying relative. There are tests associated with each of these designations. To be a qualifying child, the individual must be your child, stepchild, adopted child, foster child, brother, sister, half-sibling or any descendent of any of these groups. The child must be under the age of 19, or 24 if a full-time student, and live with you for more than half of the year. The child cannot provide more than half of his own income, and the child cannot file a joint return for the year. To be a qualifying relative, the person cannot be a qualifying child or a qualifying child of any other person. Qualifying relatives must live with you for a full year as a member of your household or must be related to you directly and may not have income in excess of a certain statutory amount. Finally, you must provide more than half of the person’s support for the year.

To meet the requirements to be a qualifying child or relative, the child or relative must live with you for at least half of the year or the full year, respectively. In general, showing that a dependent lived with you is not a difficult task. However, in the event of a divorce, complicated situations can arise. Typically, the custodial parent will claim the child as a dependent; but in the case where a noncustodial parent claims the child, the custodial parent must sign a written declaration that he or she will not claim the child, and this declaration must be attached to the noncustodial parent’s tax return. If the child lived with each parent an equal number of nights and there is no prior decision as to which parent may claim the child, IRS rules provide that the parent with the higher adjusted gross income can claim the child as a dependent.

In order to claim a qualifying child or a qualifying relative as a dependent on your taxes, you must meet three tests: the dependent taxpayer test, the joint return test and the citizen or resident test. The dependent taxpayer test simply requires that the dependent cannot be claimed by anyone else as a dependent. The joint return test prohibits the dependent from filing a joint return. Lastly, the dependent must be a citizen of the United States or a resident alien, U.S. national or resident of Canada or Mexico.

The IRS has stringent tests to determine whether an individual will classify as a dependent because of the valuable tax benefits that are associated with such classification. For example, the number of dependents you claim on your income tax return will increase the amount of your personal exemption, which ultimately reduces your taxable income. Additionally, if you paid any dependent care expenses, you may be eligible to reduce your taxable income even further.