Who Can I Claim as a Dependent on My Tax Return?

Anyone who has ever filed taxes knows how important it is to qualify for as many tax credits, breaks, and deductions as possible. One way to lower your tax obligation and secure a bigger refund is to claim all the dependents that you can. Fortunately for you, the definition of dependent encompasses more than just your young children; dependent qualification guidelines are broken into two categories – qualifying children and qualifying relatives – and if you are the responsible caretaker in any of a number of given situations, then you may be able to claim even more dependents. Who can you claim on your tax return as a dependent? The IRS is very specific about just that. Here are the details:

Qualifying children. There are four conditions your children must meet if they are to qualify as your dependents. First off, they must be your natural or adopted children, your children by way of marriage (step-children), your foster children, your brothers and/or sisters, your nieces and/or nephews, or your grandchildren. Secondly, you must established that the dependent lived with you for at least one half of the tax year you are claiming for. Third, the dependent must meet certain age requirements as follows: eighteen or younger for the entire year, 24 or younger and a full-time student for at least five months out of the year, or any age and permanently and totally disabled. Finally, qualifying children need to have been over 50% financially supported by you during the tax year you are claiming the credit.

Tie-breakers. In the occasion that more than one person tries to claim a dependent child, the IRS will use the following factors for the tie-breaker: the claimant must be a parent; the claimant must be the one who provided more financial support over the course of the year; the dependent must have lived with the claimant for the majority of the year. Finally, if both claimants meet all of those qualifications, then the claimant with the highest incomes will be the one allowed to claim the dependent. This might result in you having to issue an IRS extension 2010 or 2011 form (1040X), depending on the time it takes the process to resolve.

Qualifying relatives. In some circumstances, you cannot claim a qualifying child, but may be able to instead claim a qualifying relative. The guidelines for qualifying a relative as a dependent are as follows: the dependent cannot be a qualified child of another claimant, the dependent must be related to you in certain ways and must have spent at least one half of the year with you, the dependent must be a United States citizen, and you must have financially supported the dependent for at least one half of the year.

As you can see, claiming dependents on your tax return is not as simple as it seems. Follow these guidelines to determine how many dependents you can claim this year.

About the Author: Nolan Cangey works as a tax accountant and spends a great deal of time interviewing his new clients to better understand what they do and how they can benefit from different tax credits and their dependents.