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!
Hi! I have 4 kids and I’m only claim 3 because I live with my mom and she has been claiming my oldest daughter that is 11 for the past 6 years well when my mom filed her taxes this they told her she can’t use my daughter any more because she’s not her legal guardian but we live with her! Is there a new law stating she can’t claim her grandchildren and can she still claim my daughter?
Hi Vanessa,
The law has remained pretty consistent since last year. You may want to review all of the rules instated by the IRS about claiming a child dependent. Also keep in mind that if your Adjusted Gross Income (AGI) equals more than your mother’s, then she will not be able to claim your child on her taxes.
i am single full time working mother , with free child care ( thankfully ) . How should i fill out my w-4 to get the most money back on tax returns
Hi Gionna,
In order to get the highest tax refund possible, you would claim zero allowances on your W-4 form. Keep in mind that although this gets you the maximum refund after filing, it will also decrease your take-home pay throughout the year. Claiming zero allowances allows your employer to withhold the maximum amount of income allowed. When taxpayers do this, more than necessary will typically be withheld, causing the IRS to issue them a refund of the difference. It is important to realize that the amount of actual tax you are paying does not change based on your W-4 form. Your W-4 only determined when you will be paying that tax; either throughout the year by withheld income or in one bulk amount after filing.
Good Evening,
Question about the W4 forms. Wanted to know if both working couples should be claiming the same number of allowance with their employers W4. We have 3 children which gives us 5 total allowance. But should we both put 5 on our W4 or should we split up the number to 3 and 2, or should the highest pay couple take all 5 and the lowest pay claim 0 allowance. Its getting much more complicated to understand this form. Yet we don’t want to have to owe any taxes if our Allowance are completed wrong. Currently we have 5 on my allowance and 5 on my spouse’s allowance. Thank you!
Hi Heather,
Joint filers should split the total amount of allowances between them. Typically, the higher earning spouse will claim the majority of allowances. This tends to be more financially beneficial. However, if you are earning about the same amount of income, it is common to split the allowances evenly. I don’t suggest that you each claim five allowances. This will most likely result in you owing tax to the IRS if too little is withheld from your paychecks throughout the year.
Okay, let’s say a single parent works part-time…if that parent made $5,000 and has 5 kids to claim, how does that work with the Child Tax Credit? Can the parent still claim all 5 kids and will she be able to get $1,000 for each?
Hi Richard,
The Child Tax Credit is nonrefundable, meaning that you can claim the credit for the amount that does not exceed your total tax due The credit will only reduce your tax due amount to $0.00. Once that is reached, the remainder cannot be claimed as a refund. That being said, the Additional Child Tax Credit can be claimed in addition to the original if you qualify. This one is refundable as long as your earned income was at least $3,000 for the year. The criteria for qualifying for the Additional credit uses Schedule 8812 and is a bit more strict. If you create an account with RapidTax, we will determine whether or not you qualify for one or both of these credits based on your criteria.
We have 5 kids and in may my daughters bf mom dropped her son off with us. She hasn’t sent no support for him at all me and my husband support him we have for 7 months. We have told her were going to claim him can we?
Hi Sabrina,
You can claim the child as a qualifying dependent if you meet the requirements listed above. These are terms set up by the IRS.