Kids are great! But they can be taxing…in more ways than one.
Growing up, my parents would always give me an increase on my allowance around April. They would say it was to teach me how to budget my money. Not to sell out my parents or anything but now I know that they were able to give me a little extra once a year because they were getting more back from the IRS after filing and claiming me as a dependent.
Let’s just say, those little bonuses stopped once I began filing my own taxes.
Is there a limit to how many dependents I can claim on my tax return?
No, there is no maximum amount of dependents you’re allowed to claim on your tax return. You can claim all dependents who are qualified child dependents according to IRS rules. Consider it a token of appreciation for supporting the ever-increasing costs of diapers, astronomical college tuition fees and for simply putting food on the table each night.
What qualifies a child as my dependent?
You may see this question to have a simple answer if you are married parents filing a joint return. However, for single parents, married parents who file separately or other relatives, the answer is not as clear.
A qualifying child dependent has slightly different requirements than a qualifying relative dependent does. In order to be considered a qualifying child dependent, they must meet all of the following requirements:
- The child must be a U.S. citizen, national, resident or a resident of Mexico or Canada.
- The child cannot be claimed by someone else or themselves if they are also taking the personal exemption.
- If the child is filing a tax return, they cannot be claiming a dependent.
- The child cannot be filing a joint tax return.
- The child must be your son, daughter, stepchild, brother, sister, eligible foster child, half sibling, stepsibling, or adopted child. He/she can also qualify if they are an offspring of any of the above.
- The child must have lived with you for more than half of the year.
- The child must be under 19 years old. If the child is a full-time student, they must be under 24 years old. There is no age limit if the child is totally and permanently disabled.
- You must have provided more than half of the child’s annual financial support.
How much is each dependent child worth on my tax return?
Each child claimed as a dependent reduces your taxable income by $4,000. Contrary to popular belief, this does not mean that $4,000 will be added to your refund or directly deducted from your tax bill. It means that the income amount that you are being taxed on is reduced which ultimately reduces your tax bill (or increases your refund amount).
Although claiming a dependent or two on your tax return opens the door to qualifying for the Child Tax Credit, it does not guarantee it.
Can I claim the Child Tax Credit?
Claiming a dependent on your tax return reduces your taxable income while claiming the child tax credit reduces your tax due amount directly. A tax credit reduces your tax bill dollar-for-dollar and each child is worth up to $1,000. To read more about qualifying for the credit, check out our article all about it HERE!
When you create an account with Rapidtax, our application will automatically let you know if you qualify for the Child Tax Credit after entering in your income and dependent information.
Happy filing!
I have custody of my 4 kids would i get the same amount as the first 2
Hi Andre,
This depends on the tax benefits that you qualify for based on your tax situation. There is a difference between what you’ll get for claiming a dependent and what you’ll get for claiming the Child Tax Credit. Claiming a dependent reduces your taxable income. It does NOT directly reduce your tax due or increase your refund. The Child Tax Credit does reduce your tax due dollar for dollar IF you qualify. I don’t want to give you the incorrect guidance solely based on your initial comment. I would first need to know which you are asking about. You can check out our other article about claiming the Child Tax Credit HERE.
i have 4 kids. Why was i told even if you claim more than 3 children , tax credit is only allowed to be given for up to three children, and any dependent after the three is just used to bring my number closer to zero to try to get max payout. what number is being referred to? is this correct.?
Hi Olivia,
There is no ‘official’ limit to how many children you can claim the Child Tax Credit for. However, additional dependents can trigger the alternative minimum tax to come into play. This tax can exactly offset the additional child tax credit for families with more dependents. Also keep in mind that if the amount of your Child Tax Credit exceeds the amount of income tax you owe, you would need to qualify to claim the Additional Child Tax Credit. You should ask your tax preparer about this if you are unfamiliar. If you are preparing your tax return with us at RapidTax.com, then you can contact our customer support team for further details and to see if you qualify.
I have 4 kids I take care of all 4. I was told I can only claim 3 for taxes. They are all u.s born one is 3 one is 4 and other two are a year old. So why can I only claim 3? Thanks
Hi Ashley,
The information you were given is incorrect. You can claim more than three qualifying dependents on your tax return.
if this is true than why last year when I did my taxes online and I added my 4 child I was given any extra credit or income tax didn’t increase and would’ve gotten the same amount back as I did with 3 or 4 kids, it didn’t matter I added another child.
Hi Moises,
You would have needed to qualify for the Additional Child Tax Credit. If you didn’t, then you would not have received an additional amount in your refund.
Hi,I just began working at a new job after 4 months being unemployed, I have a 7year old daughter and my son was just born this year in July. When Im filling the W-4, nobody can claim me, and Im claiming my 2 kids from 2 different parents, the father of my daughter died. So I am claiming my self as head of household, since Im the one paying. So, adding everything the total personal allowances is 9 since also I am adding the child tax credit. Does that number means that I will have to pay at the end a lot? Please let me know
Thanks
Hi Geraldine,
Allowances on your W-4 determine when you will be paying the tax you are responsible for paying. The total amount does not change. That being said, here’s how they work. The more allowances you claim on your W-4, the less is withheld from your income throughout the year. The less allowances you claim on your W-4, the more is withheld from your income throughout the year. If too little is withheld, then you will end up owing the IRS after filing your tax return for the year. If too much is withheld, then you will be issued a tax refund from the IRS to cover the difference that you payed.
Now that you know how it works, you can see how it affects your tax return. Ideally, you want your W-4 form to reflect how you plan to complete your tax return for that year. For example, if you plan to claim the Child Tax Credit on your return, then you may want to claim an additional allowance so that you are receiving more take home pay throughout the year. Based on the W-4 Personal Allowance guidelines, you are spot on with claiming 9 allowances. With that in mind, know that you can adjust your W-4 if you would prefer to have more withheld throughout the year and more of a refund after filing.
I have two kids and im wondering if i claim them as dependents during the year will i get a refund when i file?
Every individual’s situation is different, various factors will be your filing status, the amount of income that you earn, your deductions, the type of credits that you will be claiming. You won’t know for sure until you begin filling out your information for your tax filing for the year.
I have 4 kids and they all stay with me. Will I be able to claim all 4 of my kids
Hi Melissa,
Although all four children are living with you, there are other requirements that need to be met that prove them eligible to be claimed as your dependents. The guidelines are listed for you in the article above, under the section, “What qualifies a child as my dependent?“. As long as these are met, the IRS will consider you eligible to claim them as your dependents.