Can Both Spouses Claim Dependents?

Understanding who qualifies as a dependent for tax purposes is important for married individuals. Claiming dependents can significantly influence a taxpayer’s overall tax liability, potentially leading to valuable credits and deductions. Navigating these rules helps ensure accurate tax filing and allows taxpayers to benefit from available tax provisions.

Who Qualifies as a Dependent

To claim someone as a dependent, they must meet specific Internal Revenue Service (IRS) criteria, falling into one of two categories: a qualifying child or a qualifying relative. A person cannot be claimed as a dependent if they are filing a joint return, unless that return is filed solely to claim a refund of withheld income tax or estimated tax paid. The dependent must also be a U.S. citizen, U.S. resident alien, U.S. national, or a resident of Canada or Mexico.

A qualifying child must meet several tests. The relationship test requires the individual to be your son, daughter, stepchild, foster child, brother, sister, half-brother, half-sister, stepbrother, stepsister, or a descendant of any of these. For the age test, the child must be under age 19 at the end of the tax year, or under age 24 if a full-time student, or permanently and totally disabled at any age. The residency test dictates that the child must have lived with you for more than half of the tax year, with exceptions for temporary absences. Additionally, the child cannot have provided more than half of their own support for the year.

A qualifying relative cannot be a qualifying child of any taxpayer. Their gross income for the year must be less than $5,050 for the 2024 tax year. You must have provided more than half of the person’s total support for the year. The relationship test for a qualifying relative is broader; the person can be related to you in various ways (e.g., parent, grandparent, aunt, uncle, niece, nephew, certain in-laws) or must have lived with you all year as a member of your household.

Claiming Dependents When Married Filing Jointly

When a married couple files a joint tax return, claiming dependents becomes a unified effort. The joint return acts as a single taxpayer entity, meaning a specific dependent can only be claimed once on that combined return. Tax benefits associated with the dependent are then applied to the couple’s combined income.

Even though both spouses are included on the return, they are not each claiming the same dependent individually. Instead, the dependent is claimed by the household. The eligibility criteria for a qualifying child or qualifying relative still apply when filing jointly.

This filing status simplifies the process, avoiding complexities that can arise in other filing scenarios. Filing jointly allows most married couples to consolidate their income and deductions, including those related to dependents, to potentially achieve a lower overall tax liability.

Claiming Dependents When Married Filing Separately

Married couples who file separate tax returns face specific rules regarding dependent claims. While each spouse files their own return, they cannot both claim the same dependent. The allocation of dependents depends on various factors, especially where the dependent resided for the majority of the year.

For a qualifying child, if both parents could potentially claim the same child, “tie-breaker rules” determine which parent has the right to claim the child. If parents do not file a joint return, the child is treated as the qualifying child of the parent with whom the child lived for the longer period during the tax year. If the child lived with each parent for the exact same amount of time, the child is considered the qualifying child of the parent who had the higher adjusted gross income (AGI).

The custodial parent (the parent with whom the child lived for the greater part of the year) typically has the right to claim the child. However, the custodial parent can release this claim to the noncustodial parent using IRS Form 8332, Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent. This form allows the noncustodial parent to claim certain tax benefits for the child, such as the Child Tax Credit.

The Tax Advantages of Dependents

Claiming dependents provides several tax advantages that can reduce a taxpayer’s financial burden. One primary benefit is the Child Tax Credit, worth up to $2,000 per qualifying child for the 2024 tax year. A portion of this credit, up to $1,700 for 2024, may be refundable, meaning taxpayers could receive it as a refund even if they owe no tax. This credit begins to phase out for single filers with a modified adjusted gross income (MAGI) above $200,000, and for married couples filing jointly with a MAGI above $400,000.

For dependents who do not qualify for the Child Tax Credit, such as older children or qualifying relatives, the Credit for Other Dependents may be available. This non-refundable credit can provide up to $500 per qualifying dependent. It also phases out at MAGI levels of $200,000 for individual filers and $400,000 for joint filers.

Dependents can also impact eligibility for other tax benefits, including the Earned Income Tax Credit (EITC), which assists low to moderate-income individuals and families. The presence of qualifying children can significantly increase the amount of EITC a taxpayer can receive. Additionally, having a qualifying dependent may allow a taxpayer to qualify for the Head of Household filing status, which offers a larger standard deduction and more favorable tax rates compared to the single filing status.