This story is part of Taxes 2023, CNET's coverage of the best tax software, tax tips and everything else you need to file your return and track your refund.
If you financially support your significant other, and the two of you are not yet married or in a domestic partnership, you may yet be able to squeeze in an extra tax break this year.
A dependent is a loved one you provide financial support to throughout the year. Dependents can be a qualifying child, parent or relative, and the IRS explicitly states that a spouse cannot be a dependent. But what about unmarried individuals in a relationship? A tax break is available, but the conditions for it are very specific.
The IRS has a free guide with questions to help you determine if you have a qualified dependent, said Angel Li, certified public accountant and partner at FML CPAs, an accounting firm. "If you have low income, there's a list of credits you might qualify for by claiming a dependent, such as the earned income credit and child tax credits," said Li.
As Americans grapple with persistent inflation and spikes in consumer prices, every tax break helps. Here's what to know about how the IRS classifies dependents, along with what to do if you plan to claim one on your tax return this year.
Who qualifies as a dependent?
A dependent is someone who relied on you for financial support. The IRS classifies dependents in one of two buckets, "qualifying children" and "qualifying relatives," and defines the conditions for each in Publication 501.
To claim a boyfriend, girlfriend or anyone else as a qualifying relative, four tests must be passed, per Publication 501 (page 17). They are:
- The person is not a qualifying child.
- The person must either live with you all year as a member of your household or be related to you, as defined by the IRS.
- The person's gross income was less than $4,400 for the 2022 tax year. (There are exceptions for persons with disabilities who receive income from a sheltered workshop.)
- The person receives more than half of their support for the year from you.
Additionally, some of your dependent's income sources may not count toward the gross income threshold, said Eric Bronnenkant, certified public accountant and head of tax at Betterment, a financial advisory company. "Let's say your girlfriend collects Social Security. None of that is taxable. Social Security wouldn't count toward that $4,400 threshold," Bronnenkant said. You still need to show that you provide your dependent more than 50% of their support for the year.
All these tests can feel intimidating at first, but Publication 501 and the IRS' guided page help demystify the process, said Christian Rivera, certified public accountant and founder of The Ecommerce Accountants, an accounting firm. "A lot of people, when they hear "IRS guidance," they think 'Oh, I gotta open up a legal book with codes and regulations,'" Rivera said. "The IRS has simplified a lot of this information on its website."
What tax deductions and credits are available from having a dependent?
The biggest reason to claim a dependent on your tax return is to become eligible for several credits and/or deductions. If you're using some of your income to take care of another person, the IRS offers additional deductions and credits to provide financial relief.
Some benefits, such as the Child Tax Credit, only apply for dependents who are qualifying children. For qualifying relatives, here are some common credits and deductions to become familiar with.
Head of household status
If you have at least one dependent and are not married, you can file as head of household, which will give you more favorable income tax rates. You'll also receive a larger standard deduction if you elect to take it. The standard deduction for heads of household in 2022 is $19,400, which is $6,450 higher than if you were to file as single.
Earned income tax credit
Taxpayers who have dependents are eligible for this credit if their adjusted gross income is under a certain threshold. The AGI eligibility threshold varies, depending on whether you file as single, head of household or filing jointly, and the IRS has the most updated tables on its website. This credit is also available to taxpayers who have no dependents.
No. of dependents claimed
Filing as Single, Head of Household, or Widowed
Filing as Married Filing Jointly
Source: IRS website
American opportunity tax credit
The American opportunity tax credit applies to qualifying education expenses for the first four years of a student's postsecondary education. The credit can be taken by either the dependent or the taxpayer who claims the dependent. The maximum annual credit is $2,500 per student.
Most Americans take the standard deduction on their taxes. If you covered substantial medical expenses for yourself and/or your dependent, however, it may make more sense to itemize your deductions. You can only deduct expenses in excess of 7.5% of your adjusted gross income.
How do I claim a dependent on my taxes?
You'll claim a dependent on either Form 1040 or Form 1040-SR. When you claim a dependent, you'll enter their Social Security number along with other qualifying information. A dependent can only be claimed by one taxpayer, so the IRS uses the dependents' Social Security number to track this information.
Claiming a dependent is pretty straightforward, but "it's probably one of the most complicated areas of the tax code," Bronnenkant said. If a boyfriend or girlfriend is a member of your household, and they meet the qualifying relative requirements, claiming them as a dependent may help you save money on taxes this year.
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