Dependency Definitions: What is a qualifying child and a qualifying relative?

You are preparing your tax return when faced with the question about if you have any dependents. You think of your children but may fail to think about other relatives you are supporting. In general, people tend to think of their young son or daughter when they hear the word dependent. However, the IRS has a broader definition of dependency, which includes both qualifying children and qualifying relatives.

It is important to understand how the IRS defines dependents because claiming a dependent entitles taxpayers to certain tax benefits, including an advantageous filing status, tax credits, and other beneficial tax breaks. I will detail the requirements for each dependency category below. Lets get started!

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Qualifying Child

What is a qualifying child?

A qualifying child is a dependent that meets the IRS qualifications. I detail the specific requirements below. The dependent must meet all the requirements for the IRS to recognize him or her as a qualifying child dependent.

Requirement 1: Close relative test

Based on the close relationship test, the IRS defines a 'close relative' as your son, stepson, daughter, stepdaughter, brother, stepbrother, sister, stepsister, or a descendant from any of these stated relationships. Additionally, the IRS treats an adopted child or foster child as your dependent child.

Requirement 2: Age test

The IRS states that a qualifying child must be younger than you. Also, the age test requires that the qualifying child must be younger than 19 years old. However, if the child is a full-time student, the age limit for a qualifying child extends to younger than 24 years old. It is important to note that a full-time student means a student who attends an educational institution for at least part of five months during the tax year.

A special exception exists for disabled individuals. The IRS does not have an age limit for those who are totally and permanently disabled.  

Requirement 3: Household test and residency/citizenship

You must maintain the household for your dependent child for more than half of the tax year. In other words, the dependent must share the same home as you for half the year.

Additionally, the IRS requires a qualifying child to be a citizen of the United States or a resident of the United States, Canada, or Mexico.

Requirement 4: Filing specifications

A qualifying child cannot file a joint tax return for the tax year. Therefore, if you want to claim a married dependent, make sure the dependent does not file a joint return with his or her spouse.

Requirement 5: Support test

The IRS states that a qualifying child must not expend more than half of his or her own support during the tax year. Supports means the expenses that relate directly to the dependent. To pass the support test, you must pay for over half the expenses incurred by the dependent during the tax year.

Can you claim your dependent as a qualifying child?

If the individual meets all five requirements stated above, you should be able to claim the individual as a dependent based on the qualifying child definition. Be careful with the definition of an educational institution and the specifications of the support test. As I stated, claiming a qualifying child may entitle you to certain tax benefits.

Qualifying Relative

What is a qualifying relative?

The qualifying relative definition applies to a broader range of individuals than that of the qualifying child definition. The IRS allows you to claim a qualifying relative as a dependent if he or she meets the stated requirements. I detail the requirements for a qualifying relative below.

Requirement 1: Support test

The same support definition and test relating to a qualifying child applies to a qualifying relative. You must supply more than half of the support in order to claim a qualifying relative. If the individual supplies more than half of his or her own support, you may not make the qualifying relative dependent claim. Again, supports means the expenses that relate directly to the dependent. To pass the support test, you must pay for over half the expenses incurred by the dependent.

Requirement 2: Gross Income Limit

To meet the gross income limit requirement, the qualifying relative must report income less than $4,200 (2019, limit subject to change in future tax years). The gross income limit only relates to taxable income items; therefore, do not include non-taxable income in the test. If the individual's taxable income exceeds $4,200, you may not claim him or her as a qualifying relative dependent.

Requirement 3: Filing specifications

A qualifying relative cannot file a joint tax return for the tax year. Therefore, if you want to claim a married dependent, make sure the dependent does not file a joint return with his or her spouse. An exception to this rule exists if the joint return reports zero tax liability.

Requirement 4: Citizenship/residency

The IRS requires a qualifying relative to be a citizen of the United States or a resident of the United States, Canada, or Mexico.

Requirement 5a: Relative test

The IRS defines a relative as a child, stepchild, grandchild, parent, stepparent, grandparent, sibling, stepsibling, aunt, uncle, niece, nephew, and in-law. The IRS states that 'child' includes adopted children and foster children. Please note that foster parents and cousins do not meet the definition of a relative.

OR

Requirement 5b: Household test

The IRS states that a qualifying relative includes a non-relative living in your home for the entire tax year. This includes related and non-related individuals living in your home for the whole year. Therefore, a foster parent, cousin, or friend may meet the definition of a qualifying relative. If so, you may claim the individual as a qualifying relative dependent.

Can you claim your dependent as a qualifying relative?

If the individual meets the first four requirements and either requirement 5a or requirement 5b stated above, you should be able to claim the individual as a dependent based on the qualifying relative definition. Be careful with the specifications of the support test as well as the calculation of the dependent's taxable gross income. As I stated, claiming a qualifying relative may entitle you to certain tax benefits.

In conclusion

You may claim qualifying children and qualifying relatives as dependents on your tax return. The dependency definitions and requirements for a qualifying child and a qualifying relative differ. Make sure you know the requirements stated above in order to properly claim your dependents. Claim the dependents in order to receive tax benefits like a favorable filing status and tax credits.

I hope you increased your understanding about the dependency definitions. You should now know how to claim your dependents on your tax return. Additionally, you should be able to apply the dependency requirements to your specific situation. The definition of a dependent is broader than most people think! Please share to help others learn about qualifying children and qualifying relatives as well as the ability to claim the qualifying child and/or qualifying relative as a dependent. 

As always please share any and all comments below.

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