How to Determine the Tax Exemptions
- 1). Use the Internal Revenue Service's dependent test to see if your dependents qualify as your dependents for tax-exempt purposes. Determining factors include age, relationship, residency and care. Your dependent must meet all four of these for you to claim him or her as an exemption on your income tax return.
- 2). Determine qualification using the relationship test, which is the most important of the four tests. Dependents must be your child, adopted child, stepchild, foster child, sibling, stepsibling or the children or grandchildren of any of those relatives.
- 3). Use the residency and support tests to further determine whether or not each dependent qualifies for a tax exemption. Information required for this test is the amount of time your dependent lived with you during the tax year and the amount of their support, such as housing, groceries and utilities, you provided. Your dependent must live with you at least half of the tax year to qualify. You must provide at least 50 percent support for each dependent throughout the tax year.
- 4). Determine whether or not your dependent meets age requirements. A qualifying dependent is one aged 19 or younger. The exception to this rule is if the child is a full-time college student for at least five months of the tax year. In that case, the age limit is raised to 24.
- 5). List each of your qualifying dependents, their social security numbers and their relationship to you in the exemptions section of your income tax return. For each qualifying exemption, you receive a $3,650 tax break.
