Some major rules to note:
- You cannot claim any dependents if you or your spouse if filing jointly could be claimed as a dependent by another taxpayer.
- You cannot claim a married person who files a joint return as a dependent unless that joint return is only a claim for refund and there would be no tax liability for either spouse on separate returns.
- You cannot claim a person as a dependent unless that person is a U.S. citizen U.S. resident alien U.S. national or a resident of Canada or Mexico. (There is an exception for certain adopted children)
- You cannot claim a person as a dependent unless that person is your qualifying child or qualifying relative.
There is a test to determine if your child is a qualifying child. Your child must meet the following criteria:
- The child must be your son daughter stepchild foster child brother sister half-brother half-sister stepbrother stepsister or a descendant of any of them.
- The child must be (a) under age 19 at the end of the year and younger than you (or your spouse if filing jointly) (b) under age 24 at the end of the year a full-time student and younger than you (or your spouse if filing jointly) or (c) any age if permanently and totally disabled.
- The child must have lived with you for more than half of the year. (There are exceptions for temporary absences children who were born or died during the year children of divorced or separated parents or parents who live apart and kidnapped children.)
- The child must not have provided more than half of his or her own support for the year.
- The child is not filing a joint return for the year (unless that joint return is filed only as a claim for refund)
- If a child meets the rules to be a qualifying child of more than one person only one person can actually treat the child as a qualifying child.
There is also a test to determine if a relative can be claimed as a qualifying relative. Here are the criteria:
- The person cannot be your qualifying child or the qualifying child of any other taxpayer.
- The person either (a) must be related to you in one of the ways listed underRelatives who do not have to live with you or (b) must live with you all year as a member of your household (and your relationship must not violate local law).
- The person’s gross income for the year must be less than $3700. (There is an exception if the person is disabled and has income from a sheltered workshop)
- You must provide more than half of the person’s total support for the year. (There are exceptions for multiple support agreements children of divorced or separated parents or parents who live apart and kidnapped children.)
When dealing with the ability to claim someone on your tax return as a dependent there are many different factors involved. Contact your Louisville CPA to learn more.