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!
Can my husband claim one child and i claim another one on separate forms?
Yes, you can choose which dependents you both want to claim, however you cannot claim the same dependent. There are special circumstances that you can also indicate which each dependent that could allow both of you to claim them for certain credits as well. Our website is designed to navigate you through these options, and if you ever need any further assistance, you can feel free to contact our customer support.
This year is my ex-husbands year to claim our daughter (we alternate years its in our divorce decree) but he moved to Florida in May of 2016 and left our daughter here with me. He is also almost 4K behind in back support. Can I claim her since hes not head of household since she basically lives with me all the time now and he is behind so much in support?
You can claim the EITC even though it is his year to claim the dependent. You can also file as Head of Household and claim dependent care credits if applicable. However, you may not be able to claim the child tax credit since this is associated with dependency.
Savvy writing – I am thankful for the information . Does someone know if my assistant might obtain a sample IRS 4506 example to edit ?
I don’t get this, my friend makes about 80 cents more than means has 2 kids, does her taxes and gets 9,200 back. I have 3 kids and get back 6,800. How????
Although, your income is similar to your friend’s income, your employer may not be withholding enough taxes from your pay each month. This will result in you receiving a lower refund at the end of the tax year. You can reach out to your employer to revise your W-4 form since you may have indicated too may allowances.
I’m a single mother of three kids. How should I file my W4 form, to get the most money on my Tax returns. Please help. Thank you
Hi Stephanie,
It’s important to understand how allowances work before filling out your W-4 form. The more you claim on your W-4, the less is withheld from your paychecks throughout the year for taxes owed. The less allowances you claim, the more is withheld from your paychecks. If too little is withheld, you will owe the IRS after filing. If too much is withheld, the IRS will issue you a tax refund. Regardless of the amount of allowances you claim, the amount of tax you are responsible for remains the same until you apply eligible credits and deductions when filing your actual tax return. In order to get the highest refund possible, you would claim zero allowances. However, this also means that a high amount will be withheld from your paychecks, giving you less take-home-pay throughout the year.