Who Qualifies as Your Dependent? – Rules for Claiming Children and Other Dependents

Disclaimer: We’re tax pros, not magicians—following these rules won’t make your in-laws your dependents (no matter how much they “depend” on you). Always check with a tax professional if you’re unsure!

Why claiming dependents matters. When you’re filing your own taxes in 2025 (Tax Year 2024), chances are you might have a family that could help you get some tax breaks. The term dependent or “qualifying dependent” is very important to your tax return. Knowing the difference between someone under your roof and a dependent could make, or break your tax refund this year. 

Why It’s Important to Know Who Qualifies

Let’s talk money– when you file your taxes in 2025, each dependent could give you a nice refund. We’re talking serious cash back from Uncle Sam in your pocket. Let’s break it down a little more:

• Child Tax Credit: Up to $2,000 per qualifying child under 17 (Yes, that is really 2 grand per child)
• Earned Income Tax Credit: This can help families reach up to $7,830 for families with three or more children
• Education Credits:
  • The American Opportunity Credit could help you get up to $2,500 per student
  • Lifetime Learning Credit threshold is $2,000
• Medical Expenses: You can include expenses from your dependent’s medical care

General IRS Rules for Dependents

Let’s clear the air real quick: what does the government call a dependent? If you have kids, this is a given. If you have in-laws or your own parents living at home with you, then you can claim them as dependent. There are some stipulations to this, along with all other dependent-relatives. 

Qualifying Child – Who Meets the Criteria?

What is a “dependent child”? IRS law states any child that meets these requirements:

1. Age Requirements:
   • Under 19 at the end of the year
   • Under 24 if full-time student
   • Any age if totally disabled
2. Relationship Test:
   • Biological, adopted or stepchild
   • Foster child through proper channels
   • Sibling, step-sibling, or niece, nephew
3. Living Situation:
   • Must live with you more than half the year
   • College students living in dorms- they can still be claimed
   • Military service or boarding school does not disqualify
4. Support Test:
   • Child can’t provide more than half their own support
   • Part-time job for dependents probably won’t disqualify

Qualifying Relative – Who Meets the Criteria?

Now what about the relatives? Let’s look some examples:

• Parents (including in-laws)
• Grandparents
• Siblings (including step and half-siblings)
• Niece and nephew
• Extended family
• Non-relatives who live under your roof

They need to pass these tests:

1. Income test: Can’t make more than $5,050
2. Support Test: You must provide for more than half their total support
   • Housing costs
   • Food, clothing, medical
   • Utilities, transportation
3. Residency Test: Most relatives must live with you all year. Some exceptions may be:
   • Parents or grandparents

Special Cases and Exceptions

Divorced or Separated Parents (who gets to claim the child).

Usually only one parent can claim the child as dependent. Typically, the parent given custody of the children can claim. Some exceptions may include:

• Written agreements
• Custodial parent can release their claim with Form 8332
• Multiple children split between parents

Temporary Absences

Don’t panic– if you’re dependent isn’t under your roof, you probably don’t need to worry. Living situations for your dependent won’t normally break the residency rule:

• College dorms
• Military deployment
• Medical care

Common Mistakes to Avoid

There are some special cases where dependents may or may not be claimed. In our first example, let’s look at parents who choose to separate or divorce. The child may be claimed as dependent by only one parent if filing as separated. These children may also be under a custody agreement as part of a divorce decree (put link below). 

Double Trouble

There are some common mistakes to avoid when claiming a dependent on your tax return. The first is claiming an individual who doesn’t really meet the criteria (see above). The IRS considers this very frowned upon– fraud, they call it. Second, trying to claim a dependent already claimed by another taxpayer. This can cause serious errors with processing tax returns and may even give you penalties and interest.

Missing Documentation

Keep important documentation on hand for your dependents. Some of these may include birth certificates, school records, medical records, social security cards or proof of residency. On occasion you may be asked to prove your dependent’s status to the IRS, and having the proper documents on hand will make your life easier.

The Income Test

When you’re claiming a relative– make sure than don’t make more than the current year’s threshold. If you’re filing taxes in 2025, make sure the amount for last years total wages doesn’t go over $5,050. Even if you’re paying for most of their bills, the government doesn’t care, they will stop you from claiming them as dependent.

What to Do If You’re Unsure

There are several resources available for you to access. If your goal is to answer a simple question, the IRS website has several resources available for you as the taxpayer. When there are more moving parts at play, a professional may offer extra insight to your tax situation. Those with CPA or EA certifications are especially familiar with the IRS. Consider using someone who is a certified professional to get your best results. 

Rules of Thumb

1. Keep good records
   • Start a folder (physical and digital)
   • Update as the year progresses
   • Include changes in living situations
2. Plan ahead
   • Know when a dependent will age out
   • Track income for qualifying relatives
   • Document any receipts made supporting your dependents
3. Stay Updated
   • Tax laws are subject to change
   • Subscribe to IRS updates
   • Check with a tax professional

Don’t be embarrassed when you have to ask for help. Families are complicated but your tax planner will understand. If you make mistakes (intentionally or unintentionally), you may get some unwanted mail from a certain three-letter government agency.