Qualifying Children and Qualifying Relatives...

At TaxTeam415 we've noticed a household trend.  Every tax season, several taxpayers want to claim their live-in girlfriend and her child as exemptions.  The girlfriend does not work and the taxpayer raises her child as his own. Since he pays for all the expenses, he'd like to claim Head of Household, may he?  Unfortunately, no. His correct filing status is Single with 3 exemptions. 


Contrary to belief, California is not a common-law state. And if the above couple were of the same sex, they could claim the most favorable tax filing status as other couples by getting married and filing Married Filing Jointly. 


Qualifying Child

In most cases, it's easy to determine whether you have a qualifying child or relative. Generally, if the child is related to you, lives with you for more than half the year and is under the age of 19 (or under 24 if the child is in school)  and doesn't provide more than half his/her support, the child qualifies as an exemption.  Having a qualifying child is necessary to file as head of household or qualifying widow(er).


A qualifying child entitles the taxpayers to numerous tax benefits; such as exemptions, child tax credits, child and dependent care credits and education credits.


Qualifying Relative

A qualifying relative is an individual who lives with the taxpayer the entire year, earns less than $3900 gross income, and for whom the taxpayer provides more than half the relatives support. So you see, in the above scenario, the girlfriend and her child qualify as relatives.


An exemption to the Qualifying Relative rule is a parent.  A parent does not have to live with the taxpayer to qualify but all the other rules apply.


Should an unmarried, dependent file a return?

If you are an unmarried dependent student, you must file a tax return if your earned and/or unearned income exceeds $10,150. Even if you're not required to file, you should file a federal income tax return if you can get money back (for example, you had federal income tax withheld from your pay or you qualify for the earned income tax credit). Contact TaxTeam415 to discuss.