A dependent is a minor or adult child, parent, relative or some other individual. In general, a dependent is a person who cannot survive without support from another individual.
Children are commonly claimed as dependents by American taxpayers, and for good reason. As of 2022, the Child Tax Credit increased from $2,000 per child to $3,600 for children under the age of 6 and $3,000 for children between the ages of 6 and 17.
A child doesn’t necessarily have to be related to you if you wish to claim them as a dependent. They simply must be a member of your family who depends on your resources and supervision to survive for over half of the year.
A foster child, stepchild, sibling, half sibling, stepsibling, or descendant of any one of those types of relatives can all qualify as your dependent. But the criteria for filing Bankruptcy with a dependent is a little more complicated than just that.
When Is a Child a Dependent?
In addition to being part of your family, a child must meet the following criteria to qualify as a dependent.
The child is under a certain age or disabled.
Most dependents are children who were 19 or younger at the end of the tax year. Dependents may also be 23 or younger, provided they were a full-time student for at least five months during that tax year. However, if a child exceeds either of these age limits and a doctor has determined them to be totally and permanently disabled, then they may still qualify as a dependent.
The child resides with you.
A dependent typically lives with their parent or guardian for longer than half of the tax year (with exceptions, such as children who spent more than six months in the hospital while still under the care of their parent or guardian). In cases of divorce, the custodial parent typically claims their child as a dependent.
The child cannot provide more than half of their own financial support.
Children who are employed and provide at least half of their own financial support cannot qualify as dependents. However, “financial support” is a broad category which encompasses housing, groceries, medical expenses, recreational expenses and more.
The child is unable to file a joint tax return with someone else.
A joint tax return is a single tax return filed by a married couple. This criterion is easy to assess: If your child is married, they can no longer qualify as your dependent.
The child is a U.S. citizen.
Or, alternatively, a U.S. resident alien, U.S. national, or resident of Canada or Mexico (provided the correct conditions are also met).
When Is a Relative a Dependent?
Contrary to popular belief, a dependent does not have to be a child. So long as they meet the correct criteria, a parent or other older relative may also qualify as your dependent – thus potentially enabling you to claim a Credit for Other Dependents. That credit may amount to as much as $500, which is a great incentive to determine precisely whom you can claim as a dependent on your tax return.
You may claim an older relative as a dependent provided they meet these criteria:
The individual cannot qualify as anyone else’s child.
Even if an individual is your biological child, you cannot claim them as a dependent on your tax return in the event that they qualify as someone else’s child dependent. For example, if your child was legally adopted, you may not claim them as your dependent.
The individual must be related to you or live with you.
Parents, grandparents, stepparents, parents-in-law, uncles and aunts may all qualify as adult dependents. Alternatively, you may claim an individual as a dependent provided that they lived with you during the entirety of the tax year.
The individual’s gross income is less than $4,300.
There are exceptions to this criterion. For example, if the individual is disabled or receives income from an organization which extends special employment opportunities to people living with disabilities, then the $4,300 threshold for gross income may not apply.
The individual does not provide more than half of their own financial support.
If you provide the majority of an individual’s financial support with the aid of another person, then you may still claim them as a dependent by cosigning a Multiple Support Declaration.
This information is not intended to constitute legal advice. There are many nuances to determining whom you can legally claim as a dependent – and significant penalties if you make a misstep while doing so.
Getting a large income tax refund can impact your filing for Bankruptcy. Thomas A Blake Law Office is here to guide you through the process of properly spending your refund without impacting your future Bankruptcy filing.
Our full-service law firm provides professional representation on a broad range of legal matters pertaining to bankruptcy, personal injury, and family law throughout the state of South Dakota. If you seek high-quality legal services, then we welcome you to contact our office today.