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Several tax deductions and credits refer to a qualifying child, but what exactly is one?
Well, up until 2 years ago, different deductions and credits had different definitions of a qualifying child. However, that changed when the Working Families Relief Act of 2004 set a standard definition of a “qualifying” child.
Currently, you must meet 4 requirements to be considered a qualifying child:
1) The child must be the taxpayer’s child or stepchild (by blood or adoption), foster child, sibling or stepsibling, or a descendant of one of these.
2) The child must have the same residence as the taxpayer for more than half of the tax year, with a few exceptions for children of divorced parents and children who were born or died during the tax year.
3) The child must be under the age of 19 as of December 31 of the tax year. If the child is a full-time student (in school for at least 5 months/year), then they may be considered up to the age of 24. Additionally, if the child is totally or permanently disabled at any point in the year they can be considered.
4) Finally, the taxpayer must provide more than 50% of the child’s support for the year.
If there is a possibility that the child can be claimed by 2 taxpayers, then the following standards typically determine who can claim the child:
- The parent has precedence.
- If there is more than 1 parent who can claim the child, the parent with whom the child has lived the longest during the year will have precedence. If the amount of time was equal, the parent with the higher adjusted gross income can claim the child.
- Finally, if neither of the taxpayers is a parent, the taxpayer with the highest adjusted gross income can claim the child.
While the 4 requirements usually determine whether a child qualifies or not, there are a few additional criteria for certain tax deductions/credits:
1. The child must be a U.S. citizen or national, or a resident of Mexico or Canada. There are some special conditions of the child is adopted from another country.
2. For taxpayers filing as >Head of Household Status: A qualifying child is determined by ignoring the divorced parents provision mentioned above.
3. Child and Dependent Care Credits: A qualifying child must be under 13 or permanently/totally disabled. Again, the provision for divorced parents is ignored.
4. Child Tax Credit: The child must be under 17 and a U.S. citizen or national.
5. Earned Income Credit: The child does not need to meet the 4th (support) requirement mentioned above. The child must be a resident of the U.S. and have a valid social security number. Again, the provision for divorced parents is ignored.
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