Eligible Dependents for Tax Purposes

A dependent must be either a “qualifying child” or a “qualifying relative.” You are allowed one exemption for each person you can claim as a dependent. And don’t forget, if you have a baby who is born on December 31, you can claim an exemption for the entire year!

A qualifying child and/or a qualifying relative must be a U.S. citizen, U.S. national, U.S. resident or a resident of the U.S., Canada, or Mexico, and, if married, must not file a joint return unless filing only to get a refund and a tax liability does not exist for either filer. If you can be claimed as a dependent on someone else’s return, you cannot claim anyone as a dependent.

QUALIFYING CHILD
A qualifying child must meet the following tests:

 
• RELATIONSHIP
The child must be your son, daughter, stepchild, eligible foster child, your brother, sister, stepbrother, stepsister, half brother, or half sister or the descendant of any of them.
• AGE
The child must be under age 19, or under age 24 and a full-time student, or any age, if permanently and totally disabled.
• RESIDENCY
The child must have lived with you for more than half the year.
• SUPPORT
The child must not have provided more than one-half of his/her own support for the year.
• SPECIAL TEST FOR QUALIFYING CHILD OF MORE THAN ONE PERSON
If the child meets the rules to be a qualifying child of more than one person, you must be the person entitled to claim the child as a qualifying child.

QUALIFYING RELATIVE
A qualifying relative can be a child that does not meet the qualifying child test or be a relative (such as parent, grandparent, aunt, uncle or in-law), or can be an unrelated member of your household. A qualifying relative must meet the following tests:

• NOT A QUALIFYING CHILD
The person cannot be your qualifying child or the qualifying child of anyone else.
• MEMBER OF HOUSEHOLD OR RELATIONSHIP
The person must either live with you for the entire year as a member of your household or be related to you.
• GROSS INCOME TEST
The person’s gross income for the year must be less than $3,400.
• SUPPORT TEST
You must provide more than half of the person’s total support during the calendar year.

SOCIAL SECURITY NUMBERS FOR DEPENDENTS
Social security numbers are required for any person you claim as a dependent.

SOME OTHER IMPORTANT NOTES FOR YOUR DEPENDENTS 
Usually, the parent who has physical custody of a child for the greater part of the year is allowed to claim the exemption for that child. However, there are instances when someone other than the custodial parent can claim the child:

 
• The noncustodial parent can claim the exemption when the custodial parent signs a waiver (Form 8332, Release of Claim to Exemption for Child of Divorced or Separated Parents). This rule also applies to parents who never married.
• A noncustodial parent who has a legal written document specifying that parent is entitled to the exemption or has a valid pre-1985 agreement and provides at least $600 towards the support of the child can claim the exemption.

Liberty Tax professionals are available for your tax needs. Please call your local Liberty Tax office for further information.