0
This is a qualified Yes (with some exceptions). They are an exemption as a dependent, but not someone you can claim dependent care expenses unless they are disabled. You can claim educational expenses you paid for this person. The new tax laws allow it if they meet the residency requirement (lives there 365 days a year), make less than $3500, and the relationship doesn't violate local law. It's good that in tough economic times, people can support others even if not related. For instance, if your girlfriend Judy lived with you for a full year while she finished an associate's degree, and you paid for her associate's degree tuition, then you can deduct those educated expenses.
Unfortunately, there is much confusion and many people have been given inaccurate information about this because they are used to older pre-2005 tax laws (in fact, this article inaccurately said it wasn't deductible until 3/2009). Additionally, even some tax software has not been updated to this tax law. Therefore, it's highly recommended you consult the IRS or an accountant and review publication 501, section "Qualifying Relative".
Below are some select parts of the tax law:
== There are four tests that must be met for a person to be your qualifying relative. The four tests are: # Not a qualifying child test, # Member of household or relationship test, # Gross income test, and # Support test. Tests To Be a Qualifying Relative # The person cannot be your qualifying child or the qualifying child of any other taxpayer.
# The person either (a) must be related to you in one of the ways listed under Relatives who do not have to live with you, or (b) must live with you all year as a member of your household2 (and your relationship must not violate local law).
# The person's gross income for the year must be less than $3,500.3
# You must provide more than half of the person's total support for the year.4
== To meet this test, a person must either: # Live with you all year as a member of your household, or # Be related to you in one of the ways listed under Relatives who do not have to live with you. If at any time during the year the person was your spouse, that person cannot be your qualifying relative. However, see Personal Exemptions, earlier.
More info:
Publication 501: Qualifying Relative ( http://www.irs.gov/publications/p501/ar02.html#en_US_publink100041887 )
What else can I help you with?
Is there a medicare tax deduction?
No
Are settlement charges to borrower a tax deduction?
On settlement statement from HUD there is a settlement charge. Is this entire charge a tax deduction?
Can I get a tax deduction for my roth IRA?
There is no Roth IRA tax deduction, but this does not mean that the Roth IRA does not have tax implications. More information can be found by asking an accountant.
What is a pre-tax deduction?
A deduction taken out of payroll for something, reducing the income tax is applied to. Hence you get to pay that item with "pre tax" money...which is cheaper than after tax money.
Is cable television a tax deduction?
No
Do you claim federal tax refund on this years federal tax?
No. But if you live in one of the states that allows a state deduction for federal taxes and you took such a deduction, you may have to claim it on your state return.
Is a rainbow vacuum a medical tax deduction?
No, a rainbow vacuum is not a medical tax deduction.
What is the standard deduction for a child on my tax return?
The standard deduction for a child on your tax return is 1,100 for the 2021 tax year.
Which reduces your tax liability more, a deduction or a credit?
A tax credit reduces your tax liability more than a deduction.
Can I claim rent as a tax deduction on my income tax return?
Yes, you generally cannot claim rent as a tax deduction on your income tax return.
Java code for tax deduction in database connection?
Java code for tax deduction in database connection?
Is there a medicare tax deduction?
No
What is the standard deduction for children on federal tax returns?
The standard deduction for children on federal tax returns is 1,100 for the 2021 tax year.
Are cats a tax deduction?
Pets are not tax deductions.
What is the standard deduction for kids and how does it impact their tax liability?
The standard deduction for kids is 1,100 for the 2021 tax year. This deduction reduces the amount of a child's income that is subject to taxation, lowering their overall tax liability.
Are settlement charges to borrower a tax deduction?
On settlement statement from HUD there is a settlement charge. Is this entire charge a tax deduction?
Can I receive a tax deduction if I donate my truck?
Yes, you may receive up to $500 tax deduction if you donate your truck.
