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6 Facts About Exemptions for Dependents

6 Facts About Exemptions for Dependents
Ines Zemelman, EA
05 September 2012

Although every individual tax return has its own attributes, there are some tax rules and regulations which are consistent among all returns and applicable to all federal taxpayers. In short, the most standard rules govern dependents and exemptions. Here are 6 important factors to help you file more efficiently for 2011 before the deadline.

1. Exemptions Lower Your Taxable Income

There are only 2 kinds of exemptions when filing taxes: Personal and dependent. Personal deductions vary greatly and there are numerous different forms which apply to various fields. Dependent deductions are more consistent, however, and each exemption for dependents allows you to deduct $3,700 on your tax return.

2. Exemptions for Dependents

A dependent is classified as somebody who depended on you for a percentage of their needs at least in excess of 51% and is qualified by the IRS to be claimed as a dependent – generally a qualifying child or relative. You will need to list the social security number of each person you are claiming as an exemption.

3. If You Are a Dependent on Someone Else’s Return

If somebody else can and does claim you as a dependent you still may be required to file a tax return. Your need to file a return is highly contingent upon your earnings for the year, whether or not you are married, and your source of income. For example, if you only receive SSI or SSDI you are not required to file. If you have additional income, however, in excess of $600 you may be required to file a return.

4. Also, If You Are a Dependent

If you are a dependent on another’s return, you may not claim an exemption for yourself. For example if your parent(s) claimed you on their return you may not check the exemption box for yourself.

5. Your Spouse Can Never be Your Dependent

If you are filing a joint return you are able to claim one exemption for your spouse and one for yourself. If you are filing a separate return you can only claim your spouse if they meet 3 conditions: She/he had no gross earnings, he/she is not filing a joint return with anybody else, he/she cannot be claimed as a dependent on another taxpayer’s return.

6. Who Cannot Be Claimed as a Dependent?

You may generally not claim a person who is married if they are filing a joint income tax return with their spouse. You may not claim a dependent who is not a US citizen and does not have a valid US Social Security Number. You can, however, claim US resident aliens, US nationals or residents of Canada or Mexico for a specific portion of the year. In the case of a child adopted from abroad, you will be able to claim such an individual on your tax return as a dependent. 

If you’re confused about who you can or cannot claim as a dependent, please know that we are here to help! Make sure to give us a call to help make your tax return filing a simpler task.

Ines Zemelman, EA
founder of Taxes for Expats