Tax Education

What is Considered a Dependent?

There is a huge difference in regards to income taxes when you claim a dependent vs. when you do not. Having dependents provides plenty of tax breaks and credits that you want to take advantage of. In fact, it could potentially save you thousands of dollars on taxes.

However, it is not as easy as simply writing off a minor or distant relative. There are qualifying factors you need to check off.

What is considered a dependent? Get the tax education you need about what the IRS considers eligible dependents and how to claim them on your return.

What is a Dependent?

A dependent is a person other than the taxpayer or spouse who entitles the taxpayer to claim the person as someone they helped provide for and take care of during the tax year.

Dependent is often used interchangeably with terms like “qualifying child” or “qualifying relative”.

Claiming a dependent helps with taxes owed as it produces an exemption you may use under applicable circumstances. It is designed by the IRS to provide financial relief for those that helped house and cover other living expenses related to a loved one.

The biggest thing you need to consider with a dependent is that the IRS seriously enforces the exemption only being used once. For example, you cannot claim a dependent and then have a girlfriend or separated partner do the same.

A dependent can only get claimed on one tax return. Therefore, the IRS enforces fairly clear guidelines as to whether the child or relative qualifies as a dependent for you, or for someone else.

IRS Tests for Qualifying Child or Relative

The IRS has a series of qualifying child dependency tests in order to make sure the criteria is met for you to claim the individual as a dependent.

In order for a child to qualify, the potential dependent must meet the criteria provided in the following tests:

● Dependent Taxpayer Test

● Joint Return Test

● Citizen or Resident Test

● Relationship Test

● Age Test

● Residency Test

●      Support Test

A qualifying relative must also meet all of the above tests, aside from the Relationship Test, Age Test, and Residency Test. Those qualifications are replaced by the IRS with the following tests:

● Not a Qualifying Child Test

● Member of Household or Relationship Test

● Gross Income Test

How to Decide If You Have a Qualifying Dependent

The aforementioned tests provided by the IRS will walk you through the qualifications needed to make sure the person can get claimed as a legitimate dependent.

However, without getting into the specifics, there are general guidelines that should allow you to quickly determine whether or not the person will represent a qualifying child or relative.

In general, anyone that you provided housing and support for more than half of the tax year is going to represent an applicable circumstance. Of course there are exceptions, especially regarding minors, but that is the general rule.

You also need to consider the following factors:

Citizenship: The dependent must be a U.S. citizen, a resident of the U.S., Canada, or Mexico for part of the year, a legally adopted foreign child that now resides in the U.S., or an adopted child that lived with you the entire year in a foreign country.

Relationship: A dependent must be a relative or a member of your household for the entire year.

Finances: The primary reason for someone being a dependent is they were not financially able to take care of themselves and needed your assistance. Therefore, the dependent must not have earned a gross income of more than $4,150. There are some exceptions to this rule. In addition to their earned income, you also need to qualify by proving that you provided more than half of his or her support during the tax year.

There are other rules you need to follow in order to make a child or relative eligible for dependent status. For example, you will need to have a valid social security number in order to get consideration from the IRS.

5 Questions to Determine if You Have a Qualifying Dependent

Here are the basic questions you need to ask yourself and answer:

  1. Is the child related to you? Foster children and adopted children are also eligible.
  2. Do they meet the age requirement? A child must be under the age of 19 during the tax year or under 24, if a full-time student. There is an exception for disabled relatives.
  3. Do they live with you? They must have been at your residence for more than half of the tax year. There are also exceptions regarding this rule too.
  4. Do you financially support them? It is okay to have a job, so long as you still provided more than half of their support.
  5. Are you the only person claiming them? Divorced parents often have clashes in regards to who gets to claim the child as a dependent. The IRS actually has “tiebreaker rules” to settle these matters.

Qualifying relatives must meet the same criteria as well as have made less than $4,150 for 2018. If they have a gross income higher than that, they are not considered eligible dependents.

Benefits of Claiming a Dependent

It is important that you learn the numerous eligibility factors in order to claim someone as your dependent. Dependent exemptions could save you hundreds, or even thousands of dollars in taxes.

If you provided housing and financial support for a loved one, you deserve to get compensated by the federal government for your time and sacrifice.

Though tax laws that went into effect for 2018 have shifted dependency exemptions slightly, between the increased standard deduction and child tax credit you can still get plenty of financial relief.

Getting More Help with Dependent Exemptions

Do you still have more questions? The IRS has rules for just about every situation that could involve a qualifying dependent, from housekeepers to those that inherent children from a new relationship.A tax professional at Levy Tax & Associates can help answer any questions or concerns you have regarding dependents. The IRS often makes this process more confusing than they should, which is why speaking to an understanding tax professional is often the best method to get more information. Call 800-TAX-LEVY or visit for a free consultation.

Contact Levy & Associates for Dependable Tax Audit Services

Levy & Associates is available for free initial consultations. We’re happy to answer any questions you have about the audit process or address any concerns about your specific situation.

There’s never a good time to be audited, and the time-consuming process will take away from your business or family if you try to face it alone. Let us handle and coordinate communication, so you can return to your daily life.