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Claiming Parents as Dependents If They Receive Social Security Benefits

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. Continue reading “Claiming Parents as Dependents If They Receive Social Security Benefits”

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Can You Claim Parents as Dependents?

Sometimes we’re so busy growing up that we forget they’re growing old.

Everyone knows that claiming a dependent on your income tax return can get you a significantly larger refund. For every dependent you claim on your taxes you can claim an extra personal exemption. That’s a large chunk of change you can deduct from your income, thus reducing your tax burden.

But who exactly can you claim? Are you eligible to claim your parents as dependents?

When it comes to taxes there are actually two different types of dependents: qualifying children and qualifying relatives.

Obviously, you can’t claim your parents as qualifying children. So the question becomes, do they meet the requirements for qualifying relatives? Continue reading “Can You Claim Parents as Dependents?”