Who Can Be Claimed as a Dependent for Tax Purposes?

Extended Family Group On Walk Through Countryside

Almost everyone claims dependents when they file their tax return.  However, it’s not always easy to determine which individuals qualify for dependent exemptions; and claiming an ineligible dependent can increase the likelihood of an IRS audit of your return.

Eligible Dependents

According to IRS guidelines, eligible dependents are limited to qualifying children or qualifying relatives.  To meet the requirements, the person you intend to claim must be related to you in a specific way.  For example, a qualifying child can only be a natural child, legally adopted child, step-child, younger sibling, or a direct descendant of one of these individuals that is younger than age 19 at the end of the year.  This age limit is extended to 24 if the child is a full-time student.  If the child is permanently disabled, there is no age limit.

A qualifying relative can be a relative who lives with you for the entire year or a blood relative for whom you provide most of the financial support throughout the year.  Generally, if the person you intend to claim does not fall into either of these categories, you won’t be able to claim them as a dependent for tax purposes.  In both of these situations, you must provide more than half of the individual’s financial support for the entire tax year.

Qualifying Tests for Dependents

Even if the prospective dependent is a qualifying child or a qualifying relative, you’ll still have to meet certain tests in order to qualify for the dependent exemption.  These include the dependent taxpayer test, the joint return test, and the citizenship test.

To meet the dependent taxpayer test, you must not be eligible to be claimed as a dependent by another person.  For example, if you are a child younger than age 19 who earned less than the exemption amount, your parents are generally able to claim you as a dependent even if you provided care for a qualifying child or a qualifying relative.  In this case, you wouldn’t be able to claim any dependents on your return.

The joint return test refers to the possibility that your dependent will file a married filing jointly return of their own.  This can occur in cases where parents are eligible to claim their married children as dependents.  If the married child files a joint return with their spouse, the parents cannot claim the child as a dependent – even if they provided financial support for them.

The final test is the citizenship test.  In order to be an eligible dependent, the individual must be a U.S. citizen, U.S. resident alien, U.S. national, or a resident of Canada or Mexico.

– The rules regarding dependents can be complicated at times.  If you have any questions, feel free to contact us.

This blog brought to you by TaxLane, LLC, providing tax preparation and consulting services to individuals and small businesses.

Pittsburgh, Allison Park, Hampton, Shaler, Glenshaw.

IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the Internal Revenue Service, we inform you that any U.S. tax advice contained in this communication is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in this communication.