The Internal Revenue Service maintains a series of rules that allow parents and unrelated taxpayers the ability to claim a dependent exemption for adults who live in the household for at least a portion of the tax year. These rules may apply to certain adults over 18 years old who are children of the taxpayer, relatives of the taxpayer, or acquaintances who reside in the home. To claim a dependent exemption on the tax return, the taxpayer must go through a series of tests to verify the dependent's eligibility.
1. Check the age of the child at the end of the tax filing year. A child who is over 18 but under 19 at the end of the year can count as your qualifying child, and so can a student who is under 24 years old at the end of the filing year as long as they are enrolled in school for at least five months of the year. A child who is totally or permanently disabled can count as a qualifying child regardless of age.
2. Verify that the dependent passes the relative test. Only children, step-children, siblings, half siblings, step-siblings and their descendants count as children for dependent exemption purposes.
3. Calculate how many months the child lived with you during the year. A child must live with you for at least half of the filing year to count as an exemption. Exceptions are granted in cases of joint custody, temporary absences, death or kidnapping.
4. Total the child's earnings throughout the tax filing year, if applicable. If the earnings equal more than half of his support during the year, then the child does not qualify as an exemption. The child must also not be able to file a joint return on the tax year unless he does so only to claim a refund for excess taxes paid.
5. Add the dependent's information to IRS Form 1040, U.S. Individual Income Tax Return. List the name, Social Security Number and relationship to the tax filer under the Exemptions section of the form.
Adult Qualifying Relatives or Non-Relatives
1. Verify that the relative does not meet the rules for a qualifying child for yourself or for the tax return of any other taxpayer. If two people list the same person as a dependent on separate returns, the IRS will audit both returns to determine which taxpayer can make the most legitimate claim.
2. Verify that the individual lived in your home for the entire tax filing year as a member of your household in accordance with local laws.
3. Add the individual's income for the year to verify that his gross income did not exceed $3,700. The IRS grants an exception to gross earnings in excess of $3,700 if the income was earned by a disabled person at a sheltered workshop.
4. Verify that your state or local jurisdiction does not have laws against adult cohabitation if your dependent is not a relative. Such laws could invalidate your exemption.
5. Add up the living expenses for the potential dependent for the tax filing year and verify that you met at least half of the expenses for the individual.
6. Claim the dependent on Form 1040, U.S. Individual Income Tax Return, under the Exemptions section.
- IRS Publication 17, Your Federal Income Tax for Individuals, contains all of the tests necessary to determine whether or not a person counts as a qualifying child or relative you can claim as a dependent exemption. IRS publications update annually, and the latest edition will feature the most up-to-date information relating to claiming dependents.
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