It seems like just after the New Year, the panic of tax season begins to set in. For some, doing their taxes is a simple affair that they can do by themselves either by using old fashioned pen and paper, or by using one of the popular software filing kits. Of course, any filer wants to be sure to have the maximum number of deductions, but the filing process changes slightly when you are claiming dependents.
The Internal Revenue Service defines a dependent as any taxpayer’s child or relative. It’s not quite that simple, however, as the IRS may want to confirm that the dependent is in fact a child or stepchild of the taxpayer. The IRS may also want to confirm that dependent is under the age of 19 (or 24 if a full-time student), has lived with the taxpayer for more than half a year, and that the dependent cannot provide for at least half of their own support.
The rules for filing taxes that include a relative as a dependent are even trickier, and if dealing with that situation, consulting an accountant may be your best choice.
Once you’ve determined that you will indeed be claiming dependents, you may be eligible for tax credits, deductions and other tax benefits such as personal exemptions, child tax credits and dependent care credits.
The IRS makes an effort to simplify the filing of your taxes through the use of worksheets that are available online, but the safest and best way to ensure you’re getting the proper number of deductions is to sit down with an accountant. At the very least, you should use one of the great software products that ask you a series of questions in order to populate the fields on your tax return.
No matter how you prepare your tax return, filing a return claiming dependents can be more difficult than a standard individual tax return.