It’s been said that life comes full circle. Well, so do taxes.
It’s difficult to watch your parents grow old. The ones who supported you while growing up are now the ones you’re taking care of. You may be curious if you can claim your parents as dependents on your tax return like they once did for you.
The answer lies in the following five tests set up by the IRS:
#1. They must be related to you.
#2. They must be a citizen or resident of the United States, Canada, or Mexico.
#3. They must not be filing a joint tax return.
#4. They must have an annual gross income of less than $4,000.
#5. You must provide more than 50% of their financial support for the year.
With these qualifications in mind, let’s take a look at some special circumstances that might apply to you and your parents. (more…)