There can be real tax benefits when you claim dependents on your tax return, but do you know who you can claim as a dependent? A dependent is either a qualifying child or a qualifying relative.
Qualifying Child vs. Qualifying Relative
A qualifying child must:
- Be under the age of 19 at the end of the year, or under the age of 24 and a full-time student.
- Be younger than you unless they are permanently disabled.
- Be your son, daughter, stepchild, foster child, brother, sister, half-brother, half-sister, stepbrother, stepsister, or a descendant of any of them.
- Live with you for more than half the year.
- Not provide more than half of their own financial support.
- Not file a joint return.
A qualifying relative:
- Is not your qualifying child or the qualifying child of another person.
- Can be any age.
- Must live with you all year.
- Must get more than half of their financial support from you.
- Must have a gross income less than $4,400.
- Can be your son, daughter, stepchild, foster child, brother, sister, half-brother, half-sister, stepbrother, stepsister, or a descendant of any of them if they are not already your qualifying child.
- Can be your father, mother, grandparent, or other direct ancestor; your stepfather or stepmother, a brother or sister of your father or mother, or your son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law.
Who Is Not a Dependent?
There are some people that you cannot claim as dependents. They include your spouse, a foster parent, a married person who files a joint claim, housekeepers, maids or servants.
Benefits of Claiming a Dependent
When you have dependents, you may be eligible for certain tax credits that can reduce your overall tax liability. These credits include the child tax credit, the earned income credit, the credit for other dependents, the child and dependent care credit, and/or education credits.
**Please keep in mind: These lists are not necessarily exhaustive and tax laws change often. If you’re ready to learn more about claiming dependents on your tax return, call us today.