If you’re taking care of a relative or raising a child, it’s important to understand how the IRS determines who qualifies as a dependent. Before the 2018 tax year, you could reduce your taxable income by a significant amount for each dependent claimed on your tax return. Although dependent exemptions are no longer allowed, you can still claim certain tax credits and deductions which can help lower your tax liability. Many taxpayers, however, are unaware of the specific dependent requirements. Below is a general overview but, like many other areas of the tax code, it’s complex and there are often exceptions to the rule.
Who Qualifies as a Dependent?
A dependent is someone who relies on you or your spouse (if applicable) for financial support (food, clothing, housing, medical, and other necessities). Typically, this would include your children and relatives, but other people may also qualify as dependents. For federal tax purposes, however, there are two types of dependents – qualifying child and qualifying relative.
To be considered a qualifying child, a person must satisfy the following five tests:
- Relationship – the child must be your child or stepchild, adopted child, or foster child. Siblings, stepsiblings, also qualify. Descendants of any of these are also eligible.
- Residence – generally, the child must reside with you for at least half of the year. There are exceptions for births and deaths, as well as other temporary absences. Children of separated or divorced parents are also treated differently in some cases.
- Age – your child must be either:
- Under the age of 19 by the end of the tax year and younger than you (or your spouse, if filing jointly);
- A full-time student (5 months of the year) who is 23 or younger and younger than you (or your spouse, if filing jointly); or
- Permanently or totally disabled (any age).
- Support – the child cannot provide more than half of their support.
- Joint Return – a qualifying child can’t file a joint return for the year unless it’s only to claim a refund of income tax withheld or estimated taxes paid.
It is possible that a child who does not meet the requirements for a qualifying child may be eligible as a qualifying relative.
A person may be considered a qualifying relative (regardless of age) if the following conditions are met:
- Not a qualifying child – the person may not be your qualifying child or the qualifying child of another taxpayer.
- Relationship – must be related to you (no residence requirement needed) or must live with you all year as a member of your household. Relatives who don’t have to live with you include:
- Your child (natural, adopted, foster, step, or a descendant of any of these
- Siblings (full, half, or step)
- Parents and grandparents (including stepparents, but excluding foster parents)
- Nieces or nephews (including those from half-siblings)
- Uncles or aunts
- In-laws (son, daughter, father, mother, brother, or sister)
- Domestic partners, boyfriends, girlfriends, and other friends may also satisfy the relationship test if they lived with you during the entire year, don’t exceed the income limits, and your relationship doesn’t violate any laws. Your spouse, however, can’t be claimed as a dependent.
- Income – the person can’t make more than $4,300 a year (2021 tax year) in gross income unless disabled and earning money from a sheltered workshop.
- Support – they must not provide more than half of their support for the year.
There are exceptions to the support rule for children of divorced or separated parents, kidnapped children, and those with multiple support agreements.
Even if the person passes the test for qualifying child or qualifying relative, you can’t claim them as a dependent unless they also meet these three tests:
- Depended Taxpayer Test. Your dependent can’t claim anyone else as a dependent on their tax return.
- Joint Return Test. Generally, your qualifying dependent can’t be married and filing a joint return, unless that return is only filed to claim a refund of income tax withheld or estimated taxes paid.
- Citizen/Resident Test. Your dependent must be a U.S. citizen, U.S. resident alien, U.S. national, or a resident of Canada or Mexico. Adopted children who have been members of your household for the entire year also meet this test, regardless of citizenship.
Qualifying dependents also need a Social Security number (SSN) or Individual Taxpayer Identification Number (ITIN). If you do not include these on your return, the IRS will not allow you to claim them as your dependent.
Qualifying Dependent FAQs
As you can see, there are many stipulations for who qualifies as a dependent on your federal tax return. If you’re not sure if your child, relative, or friend can be claimed, it’s best to confer with a tax professional or contact the IRS for additional guidance. In the meantime, we’ve put together a shortlist of frequently asked questions that may help give you the answers you need.
Q. My husband and I are filing separately this year. Can we both claim our son?
A. No. A dependent may only be claimed by one taxpayer per year.
Q. I’m a divorced father and a non-custodial parent. I provide 75% of my daughter’s support. Can I claim her on my tax return?
A. Maybe. As the custodial parent, your spouse has the legal right to claim your child. She can release her claim to exemption by completing Form 8332, Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent, or by signing a similar statement. You would need to attach a copy of the release to your return to claim your daughter. As the non-custodial parent, you can’t claim her as a qualifying dependent for head of household status or the Earned Income Tax Credit (EITC).
Q. My son was born on December 31, can I claim him on this year’s tax return?
A. Yes. If your child was alive during the previous year and meets all the other tests for a qualifying dependent, you may claim him on your tax return. Be sure you have his SSN before filing. If you don’t have it yet, you can request an extension or file without him. Once his SSN arrives, simply file an amended return and include him on it.
Q. Can a state court order determine who can claim a dependent on a federal income return?
A. No. Federal tax law is what determines who may claim a qualifying dependent on a federal return. Even if the state court order allows the non-custodial parent to claim the child, the custodial parent would have to sign a release for the non-custodial parent to do so.
Do you have more qualifying dependent questions? You can learn more about the requirements, tests, and various exceptions by viewing IRS Publication 501.