Rules for Claiming Children and Relatives as Dependents

Being able to claim a dependent when you file taxes is going to provide you with a variety of tax benefits. Taxpayers are not only able to deduct their personal exemption when they file taxes with a dependent but they get to deduct an additional personal exemption for every dependent that they claim.

Not to mention the fact that when someone claims a dependent they may be able to get the child tax credit, the child and dependent care tax credit, and the earned income tax credit. If the taxpayer is not married and claims dependents, they may be able to file as head of household. Therefore, with all of these tax benefits coming along with claiming a dependent it is crucial to know if your dependent or child is eligible to be claimed on your tax return.

The Criteria to Claim a Dependent

  • The taxpayer cannot be a dependent of another person. Dependents are not eligible to claim dependents.
  • The taxpayer is not allowed to claim a married dependent who files jointly. However, the exception to this rule is it is okay in the event that the individual is only filing a joint return to get a refund for tax withholding, or estimated tax payments. In addition, in this case there should be no tax liability for either spouse if they would have decided to file separate returns.
  • The dependent is a citizen, national, or resident alien of the U.S., Canada, or Mexico.
  • The dependent is either a qualifying child or qualifying relative.

One taxpayer can claim each dependent who qualifies for one of the sets of criteria that tax year. Additional rules are in place to insure that two taxpayers are not claiming the same dependent.

First, the qualifying child is always going to be before the qualifying relative. If someone is a qualifying child for one taxpayer, another person cannot claim him or her as a qualifying relative on his or her tax return.

Second, for someone to be a qualifying child they must have lived with the taxpayer for more than half of the year. In addition, the person claiming them must have provided them with more than half of their care and support during that year.

The IRS is going to audit tax returns when two or more people are trying to claim the same dependent and only one taxpayer is going to win. The one who loses may also lose the child tax credit, the earned income credit, or even the head of household filing status. This means that the losing person will be subject to additional taxes, penalties, and interest. With that being said, it is obvious that dependent audits are very expensive.

To insure that you have yourself protected you want to double check that you are eligible to claim your dependents. Parents who do not live together need to review the rules for sharing tax benefits of a dependent. If you claim a dependent, you are going to want to have your documents ready to show that they are your dependent in case you need them in the future. It is also smart for separated or divorced parents to fill out a Tax Form 8332.

How TurboTax Can Help

When you file your taxes with TurboTax 2014 we help you get your biggest refund by asking you simple questions, showing you which tax credits and deductions you qualify for and recommending the best choices for maximizing your tax refund. Try their free tax refund calculator to see how big your refund will be.

Remember, when you file your taxes with Turbo Tax, you don’t need to know which tax forms to fill out. We’ll ask you simple questions about your life and put your answers on all the appropriate IRS forms.

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