With tax season in full swing, I find that more and more of our tax resolution clients turn to us for quick advice on how to properly prepare their income tax returns. (Rightfully so- filing and paying your taxes timely is a MUST when trying to resolve any back tax balances!) One of the most common questions I get is, "Who can I claim on my tax return?" With blended families becoming more and more common, it's easy to be confused on who you can claim as a dependent on your income tax return, so here are some tips!
There are 2 types of dependents in the IRS world: a Qualifying Child and a Qualifying Relative.
Generally, a Qualifying Child must be a US resident/citizen, cannot be claimed by someone else on their income tax return, cannot file a joint return, must be related to you (by blood/marriage/adoption), must be below the age of 19 (or under the age of 24 if a full-time student/any age if permanently and totally disabled), must live with you for more than half the year, and you must financially support them.
A Qualifying Relative if not related to you by blood/marriage/adoption, the individual must live with you all year. If the individual is related to you (brother/sister, half-brother/half-sister, step-brother/step-sister, parent, grandparent, nephew/niece, aunt/uncle, foster child, etc.), they do not need to live with you as long as all other requirements are met. Additional requirements include that the Qualifying Relative must make less than $3,950 per year, you must provide more than ½ of the relative's total support to them, and you must be the only person claiming the dependent on your income tax return.
Below is a list of some of the most common scenarios presented to us here at Bryson Law Firm, LLC, and our answer for each: (Please note: There are MANY different exceptions to the general guidelines presented above and examples discussed below, so for a definitive answer stop by our FREE Fax Clinic at the Lafayette Bar Association on Thursday, March 27, from 9-12!)
1. My son/daughter has a part-time job. Can I claim him/her on my tax return?
- Note: your child will not be able to take the personal exemption if you claim him/her as your dependent. Your child should check the box indicating that someone else can claim him/her as a dependent
- Yes, so long as you provide more than ½ the child's support and meet all other criteria
2. My child was born near the end of the year. No Social Security Number has been issued yet. Can I still claim my child on my tax return?
- You cannot file the return listing your newborn child as a dependent until you have the SSN and can provide it on the tax return. You can either file without the dependency exemption and amend your return once you have the SSN, or wait until you get the SSN (if this takes until after April 15, be sure to file a Form 4868 Application for Automatic Extension of Time to File US Individual Income Tax Return)
3. Can I claim my niece/nephew on my income tax return?
- Yes, so long as they are citizens of the US or meet the resident test and they qualify as a "Qualifying Child" as discussed above.
4. My adult daughter and her child (my grandchild) live with me. My daughter has no income of her own and receives no child support from her child's father. Can I claim them as dependents?
- Yes for BOTH if they are both US residents/citizens, ineligible to be claimed by someone else of their income tax return AND:
- Daughter: meets the Qualifying Relative Test= lived with you all year, makes less than $3,950 per year, and you provided more than ½ support to your daughter.
- Grandchild: meets the Qualifying Child Test= related to you, under 19 (or 24 and a full-time student), lived with you, and you provide more than ½ support.
5. My girlfriend lives with me and does not work. Can I claim her on my income tax return?
- Yes, so long as she meets the Qualifying Relative Test. Since she is not related to you by blood/marriage/adoption, she must have lived with you for the entire year. She must have earned less than $3,950 in income, you must have provided more than ½ of her support to her, she must be a resident/citizen of the US, and she cannot be claimed by someone else or file a joint tax return with someone else.
6. My ex-husband and I both contribute to the support of our children. Who can claim the children as dependents on the tax return?
- NOTE: A dependency exemption for a child can only be claimed on one return in a tax year, so both cannot claim a dependency exemption for the same child.
- If the child lived with you for the greater part of the year, the IRS will consider you the custodial parent and generally, a child is the qualifying child of the custodial parent. The non-custodial parent may be able to claim an exemption for the child if the custodial parent releases a claim to exemption with a Form 8832 Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent or by signing a substantially similar form and attaching it with the non-custodial parent's tax return.
I sure hope some of you found this helpful. As always, please don't hesitate to reach out and contact us if you have any questions or need our help!