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Turbo Tax Ez

Turbo tax ez 1. Turbo tax ez   Importance of Records Table of Contents Introduction Topics - This chapter discusses: Useful Items - You may want to see: Benefits of Recordkeeping Kinds of Records To Keep How Long To Keep Records Introduction A farmer, like other taxpayers, must keep records to prepare an accurate income tax return and determine the correct amount of tax. Turbo tax ez This chapter explains the benefits of keeping records, what kinds of records you must keep, and how long you must keep them for federal tax purposes. Turbo tax ez Tax records are not the only type of records you need to keep for your farming business. Turbo tax ez You should also keep records that measure your farm's financial performance. Turbo tax ez This publication only discusses tax records. Turbo tax ez The Farm Financial Standards Council has produced a publication that provides a detailed explanation of the recommendations of the Council for financial reporting and analysis. Turbo tax ez For information on recordkeeping, you can purchase and download Financial Guidelines for Agricultural Producers at www. Turbo tax ez ffsc. Turbo tax ez org. Turbo tax ez For more information, contact Countryside Marketing, Inc. Turbo tax ez in the following manner. Turbo tax ez Call 262-253-6902. Turbo tax ez Send a fax to 262-253-6903. Turbo tax ez Write to: Farm Financial Standards Council N78 W14573 Appleton Ave. Turbo tax ez , #287 Menomonee Falls, WI 53051. Turbo tax ez Topics - This chapter discusses: Benefits of recordkeeping Kinds of records to keep How long to keep records Useful Items - You may want to see: Publication 51 (Circular A), Agricultural Employer's Tax Guide 463 Travel, Entertainment, Gift, and Car Expenses See chapter 16 for information about getting publications. Turbo tax ez Benefits of Recordkeeping Everyone in business, including farmers, must keep appropriate records. Turbo tax ez Recordkeeping will help you do the following. Turbo tax ez Monitor the progress of your farming business. Turbo tax ez   You need records to monitor the progress of your farming business. Turbo tax ez Records can show whether your business is improving, which items are selling, or what changes you need to make. Turbo tax ez Records can help you make better decisions that may increase the likelihood of business success. Turbo tax ez Prepare your financial statements. Turbo tax ez   You need records to prepare accurate financial statements. Turbo tax ez These include income (profit and loss) statements and balance sheets. Turbo tax ez These statements can help you in dealing with your bank or creditors and help you to manage your farm business. Turbo tax ez Identify source of receipts. Turbo tax ez   You will receive money or property from many sources. Turbo tax ez Your records can identify the source of your receipts. Turbo tax ez You need this information to separate farm from nonfarm receipts and taxable from nontaxable income. Turbo tax ez Keep track of deductible expenses. Turbo tax ez   You may forget expenses when you prepare your tax return unless you record them when they occur. Turbo tax ez Prepare your tax returns. Turbo tax ez   You need records to prepare your tax return. Turbo tax ez For example, your records must support the income, expenses, and credits you report. Turbo tax ez Generally, these are the same records you use to monitor your farming business and prepare your financial statements. Turbo tax ez Support items reported on tax returns. Turbo tax ez   You must keep your business records available at all times for inspection by the IRS. Turbo tax ez If the IRS examines any of your tax returns, you may be asked to explain the items reported. Turbo tax ez A complete set of records will speed up the examination. Turbo tax ez Kinds of Records To Keep Except in a few cases, the law does not require any specific kind of records. Turbo tax ez You can choose any recordkeeping system suited to your farming business that clearly shows, for example, your income and expenses. Turbo tax ez You should set up your recordkeeping system using an accounting method that clearly shows your income for your tax year. Turbo tax ez See  chapter 2. Turbo tax ez If you are in more than one business, you should keep a complete and separate set of records for each business. Turbo tax ez A corporation should keep minutes of board of directors' meetings. Turbo tax ez Your recordkeeping system should include a summary of your business transactions. Turbo tax ez This summary is ordinarily made in accounting journals and ledgers. Turbo tax ez For example, they must show your gross income, as well as your deductions and credits. Turbo tax ez In addition, you must keep supporting documents. Turbo tax ez Purchases, sales, payroll, and other transactions you have in your business generate supporting documents such as invoices and receipts. Turbo tax ez These documents contain the information you need to record in your journals and ledgers. Turbo tax ez It is important to keep these documents because they support the entries in your journals and ledgers and on your tax return. Turbo tax ez Keep them in an orderly fashion and in a safe place. Turbo tax ez For instance, organize them by year and type of income or expense. Turbo tax ez Electronic records. Turbo tax ez   All requirements that apply to hard copy books and records also apply to electronic storage systems that maintain tax books and records. Turbo tax ez When you replace hard copy books and records, you must maintain the electronic storage systems for as long as they are material to the administration of tax law. Turbo tax ez An electronic storage system is any system for preparing or keeping your records either by electronic imaging or by transfer to an electronic storage media. Turbo tax ez The electronic storage system must index, store, preserve, retrieve and reproduce the electronically stored books and records in legible format. Turbo tax ez All electronic storage systems must provide a complete and accurate record of your data that is accessible to the IRS. Turbo tax ez Electronic storage systems are also subject to the same controls and retention guidelines as those imposed on your original hard copy books and records. Turbo tax ez The original hard copy books and records may be destroyed provided that the electronic storage system has been tested to establish that the hard copy books and records are being reproduced in compliance with IRS requirements for an electronic storage system and procedures are established to ensure continued compliance with all applicable rules and regulations. Turbo tax ez You still have the responsibility of retaining any other books and records that are required to be retained. Turbo tax ez The IRS may test your electronic storage system, including the equipment used, indexing methodology, software and retrieval capabilities. Turbo tax ez This test is not considered an examination and the results must be shared with you. Turbo tax ez If your electronic storage system meets the requirements mentioned earlier, you will be in compliance. Turbo tax ez If not, you may be subject to penalties for non-compliance, unless you continue to maintain your original hard copybooks and records in a manner that allows you and the IRS to determine your correct tax. Turbo tax ez For details on electronic storage system requirements, see Rev. Turbo tax ez Proc. Turbo tax ez 97-22. Turbo tax ez You can find Rev. Turbo tax ez Proc. Turbo tax ez 97-22 on page 9 of Internal Revenue Bulletin 1997-13 at  www. Turbo tax ez irs. Turbo tax ez gov/pub/irs-irbs/irb97-13. Turbo tax ez pdf. Turbo tax ez Travel, transportation, entertainment, and gift expenses. Turbo tax ez   Specific recordkeeping rules apply to these expenses. Turbo tax ez For more information, see Publication 463. Turbo tax ez Employment taxes. Turbo tax ez   There are specific employment tax records you must keep. Turbo tax ez For a list, see Publication 51 (Circular A). Turbo tax ez Excise taxes. Turbo tax ez   See How To Claim a Credit or Refund in chapter 14 for the specific records you must keep to verify your claim for credit or refund of excise taxes on certain fuels. Turbo tax ez Assets. Turbo tax ez   Assets are the property, such as machinery and equipment, you own and use in your business. Turbo tax ez You must keep records to verify certain information about your business assets. Turbo tax ez You need records to figure your annual depreciation deduction and the gain or (loss) when you sell the assets. Turbo tax ez Your records should show all the following. Turbo tax ez When and how you acquired the asset. Turbo tax ez Purchase price. Turbo tax ez Cost of any improvements. Turbo tax ez Section 179 deduction taken. Turbo tax ez Deductions taken for depreciation. Turbo tax ez Deductions taken for casualty losses, such as losses resulting from fires or storms. Turbo tax ez How you used the asset. Turbo tax ez When and how you disposed of the asset. Turbo tax ez Selling price. Turbo tax ez Expenses of sale. Turbo tax ez   The following are examples of records that may show this information. Turbo tax ez Purchase and sales invoices. Turbo tax ez Real estate closing statements. Turbo tax ez Canceled checks. Turbo tax ez Bank statements. Turbo tax ez Financial account statements as proof of payment. Turbo tax ez   If you do not have a canceled check, you may be able to prove payment with certain financial account statements prepared by financial institutions. Turbo tax ez These include account statements prepared for the financial institution by a third party. Turbo tax ez These account statements must be legible. Turbo tax ez The following table lists acceptable account statements. Turbo tax ez IF payment is by. Turbo tax ez . Turbo tax ez . Turbo tax ez THEN the statement must show the. Turbo tax ez . Turbo tax ez . Turbo tax ez Check Check number. Turbo tax ez Amount. Turbo tax ez Payee's name. Turbo tax ez Date the check amount was posted to the account by the financial institution. Turbo tax ez Electronic funds  transfer Amount transferred. Turbo tax ez Payee's name. Turbo tax ez Date the transfer was posted to the account by the financial institution. Turbo tax ez Credit card Amount charged. Turbo tax ez Payee's name. Turbo tax ez Transaction date. Turbo tax ez    Proof of payment of an amount, by itself, does not establish you are entitled to a tax deduction. Turbo tax ez You should also keep other documents, such as credit card sales slips and invoices, to show that you also incurred the cost. Turbo tax ez Tax returns. Turbo tax ez   Keep copies of your filed tax returns. Turbo tax ez They help in preparing future tax returns and making computations if you file an amended return. Turbo tax ez Keep copies of your information returns such as Form 1099, Schedule K-1, and Form W-2. Turbo tax ez How Long To Keep Records You must keep your records as long as they may be needed for the administration of any provision of the Internal Revenue Code. Turbo tax ez Keep records that support an item of income or a deduction appearing on a return until the period of limitations for the return runs out. Turbo tax ez A period of limitations is the period of time after which no legal action can be brought. Turbo tax ez Generally, that means you must keep your records for at least 3 years from when your tax return was due or filed or within 2 years of the date the tax was paid, whichever is later. Turbo tax ez However, certain records must be kept for a longer period of time, as discussed below. Turbo tax ez Employment taxes. Turbo tax ez   If you have employees, you must keep all employment tax records for at least 4 years after the date the tax becomes due or is paid, whichever is later. Turbo tax ez Assets. Turbo tax ez   Keep records relating to property until the period of limitations expires for the year in which you dispose of the property in a taxable disposition. Turbo tax ez You must keep these records to figure any depreciation, amortization, or depletion deduction and to figure your basis for computing gain or (loss) when you sell or otherwise dispose of the property. Turbo tax ez   You may need to keep records relating to the basis of property longer than the period of limitation. Turbo tax ez Keep those records as long as they are important in figuring the basis of the original or replacement property. Turbo tax ez Generally, this means as long as you own the property and, after you dispose of it, for the period of limitations that applies to you. Turbo tax ez For example, if you received property in a nontaxable exchange, you must keep the records for the old property, as well as for the new property, until the period of limitations expires for the year in which you dispose of the new property in a taxable disposition. Turbo tax ez For more information on basis, see chapter 6. Turbo tax ez Records for nontax purposes. Turbo tax ez   When your records are no longer needed for tax purposes, do not discard them until you check to see if you have to keep them longer for other purposes. Turbo tax ez For example, your insurance company or creditors may require you to keep them longer than the IRS does. Turbo tax ez Prev  Up  Next   Home   More Online Publications
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Taxpayer Rights

Whether you file a Form 1040EZ or a complicated corporate return, you will benefit from knowing your rights as a taxpayer and being familiar with the IRS' obligations to protect them. The goal of the Taxpayer Rights Corner is to be your one-stop shop for taxpayer rights information during every step of your interaction with the IRS.


Know Your Rights

You have rights as a taxpayer when dealing with the IRS.


Your Civil Rights Are Protected

Under no circumstances will the Internal Revenue Service tolerate discrimination by its employees, grantees, contractors, and/or subcontractors. NO ONE shall be excluded from participating in, be denied the benefits of, or be subject to discrimination because of: race, color, sex, national origin, disability, reprisal, or age in programs or activities funded by the Department of Treasury - Internal Revenue Service.


Taxpayer Advocate Service

The Taxpayer Advocate Service (TAS) is an IRS program that provides an independent system to assure that tax problems, which have not been resolved through normal channels, are promptly and fairly handled.


Notices

What should you do if you receive a notice from the IRS?


Your Rights to Representation

Learn more about granting power of attorney.

You are entitled to similar protection of confidentiality with respect to tax advice given by a federally authorized tax practitioner as with an attorney.

Every taxpayer is entitled to have access to representation. The Low Income Tax Clinic grant program is designed to help accredited academic institutions and non-profit organizations provide low to no-cost tax assistance (such as representing the taxpayer during an audit or tax collection effort) and/or tax outreach to taxpayers for whom English is a second language. 

  • Frequently Asked Questions

Examination

We accept most taxpayer's returns as filed. If we inquire about your return or select it for examination, it does not suggest that you are dishonest. The inquiry or examination may or may not result in more tax. To learn about your rights during the examination process, and for information about how audits are conducted;


Appeal Rights

It is your right to appeal any action taken by the IRS to change your account.


Collection Process

Learn about the process IRS may follow to collect overdue taxes, including a summary of your rights and other important information about the collection process.


Innocent Spouse

The Reform Act of 1998, broadened the relief from joint liability available to spouses who file joint returns.


Refund Offset

If you are due a refund but have not paid certain amounts you owe, all or part of your refund may be used to pay all or part of the past-due amount. This includes past-due federal income tax, other federal debts (such as student loans), state income tax, and child and spousal support payments.


Where To Go For 1040 Help?

The IRS sponsors volunteer assistance programs and offers help to taxpayers in many of its offices and other community locations.

Page Last Reviewed or Updated: 14-Mar-2014

The Turbo Tax Ez

Turbo tax ez 3. Turbo tax ez   Personal Exemptions and Dependents Table of Contents What's New Introduction Useful Items - You may want to see: ExemptionsPersonal Exemptions Exemptions for Dependents Qualifying Child Qualifying Relative Phaseout of Exemptions Social Security Numbers for DependentsBorn and died in 2013. Turbo tax ez Taxpayer identification numbers for aliens. Turbo tax ez Taxpayer identification numbers for adoptees. Turbo tax ez What's New Exemption amount. Turbo tax ez  The amount you can deduct for each exemption has increased. Turbo tax ez It was $3,800 for 2012. Turbo tax ez It is $3,900 for 2013. Turbo tax ez Exemption phaseout. Turbo tax ez  You lose at least part of the benefit of your exemptions if your adjusted gross income is more than a certain amount. Turbo tax ez For 2013, this amount is $150,000 for a married individual filing a separate return; $250,000 for a single individual; $275,000 for a head of household; and $300,000 for married individuals filing jointly or a qualifying widow(er). Turbo tax ez See Phaseout of Exemptions , later. Turbo tax ez Introduction This chapter discusses the following topics. Turbo tax ez Personal exemptions — You generally can take one for yourself and, if you are married, one for your spouse. Turbo tax ez Exemptions for dependents — You generally can take an exemption for each of your dependents. Turbo tax ez A dependent is your qualifying child or qualifying relative. Turbo tax ez If you are entitled to claim an exemption for a dependent, that dependent cannot claim a personal exemption on his or her own tax return. Turbo tax ez Phaseout of exemptions — Your deduction is reduced if your adjusted gross income is more than a certain amount. Turbo tax ez Social security number (SSN) requirement for dependents — You must list the SSN of any dependent for whom you claim an exemption. Turbo tax ez Deduction. Turbo tax ez   Exemptions reduce your taxable income. Turbo tax ez You can deduct $3,900 for each exemption you claim in 2013. Turbo tax ez But you may lose at least part of the dollar amount of your exemptions if your adjusted gross income is more than a certain amount. Turbo tax ez See Phaseout of Exemptions , later. Turbo tax ez How to claim exemptions. Turbo tax ez    How you claim an exemption on your tax return depends on which form you file. Turbo tax ez    If you file Form 1040EZ, the exemption amount is combined with the standard deduction amount and entered on line 5. Turbo tax ez    If you file Form 1040A, complete lines 6a through 6d. Turbo tax ez The total number of exemptions you can claim is the total in the box on line 6d. Turbo tax ez Also complete line 26. Turbo tax ez   If you file Form 1040, complete lines 6a through 6d. Turbo tax ez The total number of exemptions you can claim is the total in the box on line 6d. Turbo tax ez Also complete line 42. Turbo tax ez Useful Items - You may want to see: Publication 501 Exemptions, Standard Deduction, and Filing Information Form (and Instructions) 2120 Multiple Support Declaration 8332 Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent Exemptions There are two types of exemptions you may be able to take: Personal exemptions for yourself and your spouse, and Exemptions for dependents (dependency exemptions). Turbo tax ez While each is worth the same amount ($3,900 for 2013), different rules apply to each type. Turbo tax ez Personal Exemptions You are generally allowed one exemption for yourself. Turbo tax ez If you are married, you may be allowed one exemption for your spouse. Turbo tax ez These are called personal exemptions. Turbo tax ez Your Own Exemption You can take one exemption for yourself unless you can be claimed as a dependent by another taxpayer. Turbo tax ez If another taxpayer is entitled to claim you as a dependent, you cannot take an exemption for yourself even if the other taxpayer does not actually claim you as a dependent. Turbo tax ez Your Spouse's Exemption Your spouse is never considered your dependent. Turbo tax ez Joint return. Turbo tax ez   On a joint return you can claim one exemption for yourself and one for your spouse. Turbo tax ez Separate return. Turbo tax ez   If you file a separate return, you can claim an exemption for your spouse only if your spouse had no gross income, is not filing a return, and was not the dependent of another taxpayer. Turbo tax ez This is true even if the other taxpayer does not actually claim your spouse as a dependent. Turbo tax ez You can claim an exemption for your spouse even if he or she is a nonresident alien; in that case, your spouse must have no gross income for U. Turbo tax ez S. Turbo tax ez tax purposes, must not be filing a return, and must not be the dependent of another taxpayer. Turbo tax ez Death of spouse. Turbo tax ez   If your spouse died during the year and you file a joint return for yourself and your deceased spouse, you generally can claim your spouse's exemption under the rules just explained in Joint return . Turbo tax ez If you file a separate return for the year, you may be able to claim your spouse's exemption under the rules just described in Separate return . Turbo tax ez   If you remarried during the year, you cannot take an exemption for your deceased spouse. Turbo tax ez   If you are a surviving spouse without gross income and you remarry in the year your spouse died, you can be claimed as an exemption on both the final separate return of your deceased spouse and the separate return of your new spouse for that year. Turbo tax ez If you file a joint return with your new spouse, you can be claimed as an exemption only on that return. Turbo tax ez Divorced or separated spouse. Turbo tax ez   If you obtained a final decree of divorce or separate maintenance during the year, you cannot take your former spouse's exemption. Turbo tax ez This rule applies even if you provided all of your former spouse's support. Turbo tax ez Exemptions for Dependents You are allowed one exemption for each person you can claim as a dependent. Turbo tax ez You can claim an exemption for a dependent even if your dependent files a return. Turbo tax ez The term “dependent” means: A qualifying child, or A qualifying relative. Turbo tax ez The terms “ qualifying child ” and “ qualifying relative ” are defined later. Turbo tax ez You can claim an exemption for a qualifying child or qualifying relative only if these three tests are met. Turbo tax ez Dependent taxpayer test. Turbo tax ez Joint return test. Turbo tax ez Citizen or resident test. Turbo tax ez These three tests are explained in detail later. Turbo tax ez All the requirements for claiming an exemption for a dependent are summarized in Table 3-1. Turbo tax ez Table 3-1. Turbo tax ez Overview of the Rules for Claiming an Exemption for a Dependent Caution. Turbo tax ez This table is only an overview of the rules. Turbo tax ez For details, see the rest of this chapter. Turbo tax ez You cannot claim any dependents if you (or your spouse, if filing jointly) could be claimed as a dependent by another taxpayer. Turbo tax ez   You cannot claim a married person who files a joint return as a dependent unless that joint return is filed only to claim a refund of withheld income tax or estimated tax paid. Turbo tax ez   You cannot claim a person as a dependent unless that person is a U. Turbo tax ez S. Turbo tax ez citizen, U. Turbo tax ez S. Turbo tax ez resident alien, U. Turbo tax ez S. Turbo tax ez national, or a resident of Canada or Mexico. Turbo tax ez 1  You cannot claim a person as a dependent unless that person is your qualifying child or qualifying relative. Turbo tax ez   Tests To Be a Qualifying Child   Tests To Be a Qualifying Relative The child must be your son, daughter, stepchild, foster child, brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant of any of them. Turbo tax ez   The child must be (a) under age 19 at the end of the year and younger than you (or your spouse, if filing jointly), (b) under age 24 at the end of the year, a student, and younger than you (or your spouse, if filing jointly), or (c) any age if permanently and totally disabled. Turbo tax ez   The child must have lived with you for more than half of the year. Turbo tax ez 2  The child must not have provided more than half of his or her own support for the year. Turbo tax ez   The child is not filing a joint return for the year (unless that return is filed only to get a refund of income tax withheld or estimated tax paid). Turbo tax ez  If the child meets the rules to be a qualifying child of more than one person, only one person can actually treat the child as a qualifying child. Turbo tax ez See the Special Rule for Qualifying Child of More Than One Person to find out which person is the person entitled to claim the child as a qualifying child. Turbo tax ez   The person cannot be your qualifying child or the qualifying child of any other taxpayer. Turbo tax ez   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). Turbo tax ez   The person's gross income for the year must be less than $3,900. Turbo tax ez 3  You must provide more than half of the person's total support for the year. Turbo tax ez 4  1There is an exception for certain adopted children. Turbo tax ez 2There are exceptions for temporary absences, children who were born or died during the year, children of divorced or separated parents (or parents who live apart), and kidnapped children. Turbo tax ez 3There is an exception if the person is disabled and has income from a sheltered workshop. Turbo tax ez 4There are exceptions for multiple support agreements, children of divorced or separated parents (or parents who live apart), and kidnapped children. Turbo tax ez Dependent not allowed a personal exemption. Turbo tax ez If you can claim an exemption for your dependent, the dependent cannot claim his or her own personal exemption on his or her own tax return. Turbo tax ez This is true even if you do not claim the dependent's exemption on your return. Turbo tax ez It is also true if the dependent's exemption on your return is reduced or eliminated under the phaseout rule described under Phaseout of Exemptions, later. Turbo tax ez Housekeepers, maids, or servants. Turbo tax ez   If these people work for you, you cannot claim exemptions for them. Turbo tax ez Child tax credit. Turbo tax ez   You may be entitled to a child tax credit for each qualifying child who was under age 17 at the end of the year if you claimed an exemption for that child. Turbo tax ez For more information, see chapter 34. Turbo tax ez Dependent Taxpayer Test If you can be claimed as a dependent by another person, you cannot claim anyone else as a dependent. Turbo tax ez Even if you have a qualifying child or qualifying relative, you cannot claim that person as a dependent. Turbo tax ez If you are filing a joint return and your spouse can be claimed as a dependent by someone else, you and your spouse cannot claim any dependents on your joint return. Turbo tax ez Joint Return Test You generally cannot claim a married person as a dependent if he or she files a joint return. Turbo tax ez Exception. Turbo tax ez   You can claim an exemption for a person who files a joint return if that person and his or her spouse file the joint return only to claim a refund of income tax withheld or estimated tax paid. Turbo tax ez Example 1—child files joint return. Turbo tax ez You supported your 18-year-old daughter, and she lived with you all year while her husband was in the Armed Forces. Turbo tax ez He earned $25,000 for the year. Turbo tax ez The couple files a joint return. Turbo tax ez You cannot take an exemption for your daughter. Turbo tax ez Example 2—child files joint return only as claim for refund of withheld tax. Turbo tax ez Your 18-year-old son and his 17-year-old wife had $800 of wages from part-time jobs and no other income. Turbo tax ez Neither is required to file a tax return. Turbo tax ez They do not have a child. Turbo tax ez Taxes were taken out of their pay so they filed a joint return only to get a refund of the withheld taxes. Turbo tax ez The exception to the joint return test applies, so you are not disqualified from claiming an exemption for each of them just because they file a joint return. Turbo tax ez You can claim exemptions for each of them if all the other tests to do so are met. Turbo tax ez Example 3—child files joint return to claim American opportunity credit. Turbo tax ez The facts are the same as in Example 2 except no taxes were taken out of your son's pay. Turbo tax ez He and his wife are not required to file a tax return. Turbo tax ez However, they file a joint return to claim an American opportunity credit of $124 and get a refund of that amount. Turbo tax ez Because claiming the American opportunity credit is their reason for filing the return, they are not filing it only to get a refund of income tax withheld or estimated tax paid. Turbo tax ez The exception to the joint return test does not apply, so you cannot claim an exemption for either of them. Turbo tax ez Citizen or Resident Test You cannot claim a person as a dependent unless that person is a U. Turbo tax ez S. Turbo tax ez citizen, U. Turbo tax ez S. Turbo tax ez resident alien, U. Turbo tax ez S. Turbo tax ez national, or a resident of Canada or Mexico. Turbo tax ez However, there is an exception for certain adopted children, as explained next. Turbo tax ez Exception for adopted child. Turbo tax ez   If you are a U. Turbo tax ez S. Turbo tax ez citizen or U. Turbo tax ez S. Turbo tax ez national who has legally adopted a child who is not a U. Turbo tax ez S. Turbo tax ez citizen, U. Turbo tax ez S. Turbo tax ez resident alien, or U. Turbo tax ez S. Turbo tax ez national, this test is met if the child lived with you as a member of your household all year. Turbo tax ez This exception also applies if the child was lawfully placed with you for legal adoption. Turbo tax ez Child's place of residence. Turbo tax ez   Children usually are citizens or residents of the country of their parents. Turbo tax ez   If you were a U. Turbo tax ez S. Turbo tax ez citizen when your child was born, the child may be a U. Turbo tax ez S. Turbo tax ez citizen and meet this test even if the other parent was a nonresident alien and the child was born in a foreign country. Turbo tax ez Foreign students' place of residence. Turbo tax ez   Foreign students brought to this country under a qualified international education exchange program and placed in American homes for a temporary period generally are not U. Turbo tax ez S. Turbo tax ez residents and do not meet this test. Turbo tax ez You cannot claim an exemption for them. Turbo tax ez However, if you provided a home for a foreign student, you may be able to take a charitable contribution deduction. Turbo tax ez See Expenses Paid for Student Living With You in chapter 24. Turbo tax ez U. Turbo tax ez S. Turbo tax ez national. Turbo tax ez   A U. Turbo tax ez S. Turbo tax ez national is an individual who, although not a U. Turbo tax ez S. Turbo tax ez citizen, owes his or her allegiance to the United States. Turbo tax ez U. Turbo tax ez S. Turbo tax ez nationals include American Samoans and Northern Mariana Islanders who chose to become U. Turbo tax ez S. Turbo tax ez nationals instead of U. Turbo tax ez S. Turbo tax ez citizens. Turbo tax ez Qualifying Child Five tests must be met for a child to be your qualifying child. Turbo tax ez The five tests are: Relationship, Age, Residency, Support, and Joint return. Turbo tax ez These tests are explained next. Turbo tax ez If a child meets the five tests to be the qualifying child of more than one person, a special rule applies to determine which person can actually treat the child as a qualifying child. Turbo tax ez See Special Rule for Qualifying Child of More Than One Person, later. Turbo tax ez Relationship Test To meet this test, a child must be: Your son, daughter, stepchild, foster child, or a descendant (for example, your grandchild) of any of them, or Your brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant (for example, your niece or nephew) of any of them. Turbo tax ez Adopted child. Turbo tax ez   An adopted child is always treated as your own child. Turbo tax ez The term “adopted child” includes a child who was lawfully placed with you for legal adoption. Turbo tax ez Foster child. Turbo tax ez   A foster child is an individual who is placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction. Turbo tax ez Age Test To meet this test, a child must be: Under age 19 at the end of the year and younger than you (or your spouse, if filing jointly), A student under age 24 at the end of the year and younger than you (or your spouse, if filing jointly), or Permanently and totally disabled at any time during the year, regardless of age. Turbo tax ez Example. Turbo tax ez Your son turned 19 on December 10. Turbo tax ez Unless he was permanently and totally disabled or a student, he does not meet the age test because, at the end of the year, he was not under age 19. Turbo tax ez Child must be younger than you or spouse. Turbo tax ez   To be your qualifying child, a child who is not permanently and totally disabled must be younger than you. Turbo tax ez However, if you are married filing jointly, the child must be younger than you or your spouse but does not have to be younger than both of you. Turbo tax ez Example 1—child not younger than you or spouse. Turbo tax ez Your 23-year-old brother, who is a student and unmarried, lives with you and your spouse. Turbo tax ez He is not disabled. Turbo tax ez Both you and your spouse are 21 years old, and you file a joint return. Turbo tax ez Your brother is not your qualifying child because he is not younger than you or your spouse. Turbo tax ez Example 2—child younger than your spouse but not younger than you. Turbo tax ez The facts are the same as in Example 1 except your spouse is 25 years old. Turbo tax ez Because your brother is younger than your spouse, and you and your spouse are filing a joint return, your brother is your qualifying child, even though he is not younger than you. Turbo tax ez Student defined. Turbo tax ez   To qualify as a student, your child must be, during some part of each of any 5 calendar months of the year: A full-time student at a school that has a regular teaching staff, course of study, and a regularly enrolled student body at the school, or A student taking a full-time, on-farm training course given by a school described in (1), or by a state, county, or local government agency. Turbo tax ez The 5 calendar months do not have to be consecutive. Turbo tax ez Full-time student. Turbo tax ez   A full-time student is a student who is enrolled for the number of hours or courses the school considers to be full-time attendance. Turbo tax ez School defined. Turbo tax ez   A school can be an elementary school, junior or senior high school, college, university, or technical, trade, or mechanical school. Turbo tax ez However, an on-the-job training course, correspondence school, or school offering courses only through the Internet does not count as a school. Turbo tax ez Vocational high school students. Turbo tax ez   Students who work on “co-op” jobs in private industry as a part of a school's regular course of classroom and practical training are considered full-time students. Turbo tax ez Permanently and totally disabled. Turbo tax ez   Your child is permanently and totally disabled if both of the following apply. Turbo tax ez He or she cannot engage in any substantial gainful activity because of a physical or mental condition. Turbo tax ez A doctor determines the condition has lasted or can be expected to last continuously for at least a year or can lead to death. Turbo tax ez Residency Test To meet this test, your child must have lived with you for more than half the year. Turbo tax ez There are exceptions for temporary absences, children who were born or died during the year, kidnapped children, and children of divorced or separated parents. Turbo tax ez Temporary absences. Turbo tax ez   Your child is considered to have lived with you during periods of time when one of you, or both, are temporarily absent due to special circumstances such as: Illness, Education, Business, Vacation, or Military service. Turbo tax ez Your child is also considered to have lived with you during any required hospital stay following birth, as long as the child would have lived with you during that time but for the hospitalization. Turbo tax ez Death or birth of child. Turbo tax ez   A child who was born or died during the year is treated as having lived with you more than half of the year if your home was the child's home more than half of the time he or she was alive during the year. Turbo tax ez Child born alive. Turbo tax ez   You may be able to claim an exemption for a child born alive during the year, even if the child lived only for a moment. Turbo tax ez State or local law must treat the child as having been born alive. Turbo tax ez There must be proof of a live birth shown by an official document, such as a birth certificate. Turbo tax ez The child must be your qualifying child or qualifying relative, and all the other tests to claim an exemption for a dependent must be met. Turbo tax ez Stillborn child. Turbo tax ez   You cannot claim an exemption for a stillborn child. Turbo tax ez Kidnapped child. Turbo tax ez   You may be able to treat your child as meeting the residency test even if the child has been kidnapped. Turbo tax ez See Publication 501 for details. Turbo tax ez Children of divorced or separated parents (or parents who live apart). Turbo tax ez   In most cases, because of the residency test, a child of divorced or separated parents is the qualifying child of the custodial parent. Turbo tax ez However, the child will be treated as the qualifying child of the noncustodial parent if all four of the following statements are true. Turbo tax ez The parents: Are divorced or legally separated under a decree of divorce or separate maintenance, Are separated under a written separation agreement, or Lived apart at all times during the last 6 months of the year, whether or not they are or were married. Turbo tax ez The child received over half of his or her support for the year from the parents. Turbo tax ez The child is in the custody of one or both parents for more than half of the year. Turbo tax ez Either of the following statements is true. Turbo tax ez The custodial parent signs a written declaration, discussed later, that he or she will not claim the child as a dependent for the year, and the noncustodial parent attaches this written declaration to his or her return. Turbo tax ez (If the decree or agreement went into effect after 1984 and before 2009, see Post-1984 and pre-2009 divorce decree or separation agreement , later. Turbo tax ez If the decree or agreement went into effect after 2008, see Post-2008 divorce decree or separation agreement , later. Turbo tax ez ) A pre-1985 decree of divorce or separate maintenance or written separation agreement that applies to 2013 states that the noncustodial parent can claim the child as a dependent, the decree or agreement was not changed after 1984 to say the noncustodial parent cannot claim the child as a dependent, and the noncustodial parent provides at least $600 for the child's support during the year. Turbo tax ez Custodial parent and noncustodial parent. Turbo tax ez   The custodial parent is the parent with whom the child lived for the greater number of nights during the year. Turbo tax ez The other parent is the noncustodial parent. Turbo tax ez   If the parents divorced or separated during the year and the child lived with both parents before the separation, the custodial parent is the one with whom the child lived for the greater number of nights during the rest of the year. Turbo tax ez   A child is treated as living with a parent for a night if the child sleeps: At that parent's home, whether or not the parent is present, or In the company of the parent, when the child does not sleep at a parent's home (for example, the parent and child are on vacation together). Turbo tax ez Equal number of nights. Turbo tax ez   If the child lived with each parent for an equal number of nights during the year, the custodial parent is the parent with the higher adjusted gross income (AGI). Turbo tax ez December 31. Turbo tax ez   The night of December 31 is treated as part of the year in which it begins. Turbo tax ez For example, December 31, 2013, is treated as part of 2013. Turbo tax ez Emancipated child. Turbo tax ez   If a child is emancipated under state law, the child is treated as not living with either parent. Turbo tax ez See Examples 5 and 6. Turbo tax ez Absences. Turbo tax ez   If a child was not with either parent on a particular night (because, for example, the child was staying at a friend's house), the child is treated as living with the parent with whom the child normally would have lived for that night, except for the absence. Turbo tax ez But if it cannot be determined with which parent the child normally would have lived or if the child would not have lived with either parent that night, the child is treated as not living with either parent that night. Turbo tax ez Parent works at night. Turbo tax ez   If, due to a parent's nighttime work schedule, a child lives for a greater number of days, but not nights, with the parent who works at night, that parent is treated as the custodial parent. Turbo tax ez On a school day, the child is treated as living at the primary residence registered with the school. Turbo tax ez Example 1—child lived with one parent for a greater number of nights. Turbo tax ez You and your child’s other parent are divorced. Turbo tax ez In 2013, your child lived with you 210 nights and with the other parent 155 nights. Turbo tax ez You are the custodial parent. Turbo tax ez Example 2—child is away at camp. Turbo tax ez In 2013, your daughter lives with each parent for alternate weeks. Turbo tax ez In the summer, she spends 6 weeks at summer camp. Turbo tax ez During the time she is at camp, she is treated as living with you for 3 weeks and with her other parent, your ex-spouse, for 3 weeks because this is how long she would have lived with each parent if she had not attended summer camp. Turbo tax ez Example 3—child lived same number of nights with each parent. Turbo tax ez Your son lived with you 180 nights during the year and lived the same number of nights with his other parent, your ex-spouse. Turbo tax ez Your AGI is $40,000. Turbo tax ez Your ex-spouse's AGI is $25,000. Turbo tax ez You are treated as your son's custodial parent because you have the higher AGI. Turbo tax ez Example 4—child is at parent’s home but with other parent. Turbo tax ez Your son normally lives with you during the week and with his other parent, your ex-spouse, every other weekend. Turbo tax ez You become ill and are hospitalized. Turbo tax ez The other parent lives in your home with your son for 10 consecutive days while you are in the hospital. Turbo tax ez Your son is treated as living with you during this 10-day period because he was living in your home. Turbo tax ez Example 5—child emancipated in May. Turbo tax ez When your son turned age 18 in May 2013, he became emancipated under the law of the state where he lives. Turbo tax ez As a result, he is not considered in the custody of his parents for more than half of the year. Turbo tax ez The special rule for children of divorced or separated parents does not apply. Turbo tax ez Example 6—child emancipated in August. Turbo tax ez Your daughter lives with you from January 1, 2013, until May 31, 2013, and lives with her other parent, your ex-spouse, from June 1, 2013, through the end of the year. Turbo tax ez She turns 18 and is emancipated under state law on August 1, 2013. Turbo tax ez Because she is treated as not living with either parent beginning on August 1, she is treated as living with you the greater number of nights in 2013. Turbo tax ez You are the custodial parent. Turbo tax ez Written declaration. Turbo tax ez    The custodial parent may use either Form 8332 or a similar statement (containing the same information required by the form) to make the written declaration to release the exemption to the noncustodial parent. Turbo tax ez The noncustodial parent must attach a copy of the form or statement to his or her tax return. Turbo tax ez   The exemption can be released for 1 year, for a number of specified years (for example, alternate years), or for all future years, as specified in the declaration. Turbo tax ez Post-1984 and pre-2009 divorce decree or separation agreement. Turbo tax ez   If the divorce decree or separation agreement went into effect after 1984 and before 2009, the noncustodial parent may be able to attach certain pages from the decree or agreement instead of Form 8332. Turbo tax ez The decree or agreement must state all three of the following. Turbo tax ez The noncustodial parent can claim the child as a dependent without regard to any condition, such as payment of support. Turbo tax ez The custodial parent will not claim the child as a dependent for the year. Turbo tax ez The years for which the noncustodial parent, rather than the custodial parent, can claim the child as a dependent. Turbo tax ez   The noncustodial parent must attach all of the following pages of the decree or agreement to his or her tax return. Turbo tax ez The cover page (write the other parent's social security number on this page). Turbo tax ez The pages that include all of the information identified in items (1) through (3) above. Turbo tax ez The signature page with the other parent's signature and the date of the agreement. Turbo tax ez Post-2008 divorce decree or separation agreement. Turbo tax ez   The noncustodial parent cannot attach pages from the decree or agreement instead of Form 8332 if the decree or agreement went into effect after 2008. Turbo tax ez The custodial parent must sign either Form 8332 or a similar statement whose only purpose is to release the custodial parent's claim to an exemption for a child, and the noncustodial parent must attach a copy to his or her return. Turbo tax ez The form or statement must release the custodial parent's claim to the child without any conditions. Turbo tax ez For example, the release must not depend on the noncustodial parent paying support. Turbo tax ez    The noncustodial parent must attach the required information even if it was filed with a return in an earlier year. Turbo tax ez Revocation of release of claim to an exemption. Turbo tax ez   The custodial parent can revoke a release of claim to exemption that he or she previously released to the noncustodial parent on Form 8332 (or a similar statement). Turbo tax ez For the revocation to be effective for 2013, the custodial parent must have given (or made reasonable efforts to give) written notice of the revocation to the noncustodial parent in 2012 or earlier. Turbo tax ez The custodial parent can use Part III of Form 8332 for this purpose and must attach a copy of the revocation to his or her return for each tax year he or she claims the child as a dependent as a result of the revocation. Turbo tax ez Remarried parent. Turbo tax ez   If you remarry, the support provided by your new spouse is treated as provided by you. Turbo tax ez Parents who never married. Turbo tax ez   This special rule for divorced or separated parents also applies to parents who never married, and who lived apart at all times during the last 6 months of the year. Turbo tax ez Support Test (To Be a Qualifying Child) To meet this test, the child cannot have provided more than half of his or her own support for the year. Turbo tax ez This test is different from the support test to be a qualifying relative, which is described later. Turbo tax ez However, to see what is or is not support, see Support Test (To Be a Qualifying Relative) , later. Turbo tax ez If you are not sure whether a child provided more than half of his or her own support, you may find Worksheet 3-1 helpful. Turbo tax ez Worksheet 3-1. Turbo tax ez Worksheet for Determining Support Funds Belonging to the Person You Supported       1. Turbo tax ez Enter the total funds belonging to the person you supported, including income received (taxable and nontaxable) and amounts borrowed during the year, plus the amount in savings and other accounts at the beginning of the year. Turbo tax ez Do not include funds provided by the state; include those amounts on line 23 instead 1. Turbo tax ez     2. Turbo tax ez Enter the amount on line 1 that was used for the person's support 2. Turbo tax ez     3. Turbo tax ez Enter the amount on line 1 that was used for other purposes 3. Turbo tax ez     4. Turbo tax ez Enter the total amount in the person's savings and other accounts at the end of the year 4. Turbo tax ez     5. Turbo tax ez Add lines 2 through 4. Turbo tax ez (This amount should equal line 1. Turbo tax ez ) 5. Turbo tax ez     Expenses for Entire Household (where the person you supported lived)       6. Turbo tax ez Lodging (complete line 6a or 6b):         a. Turbo tax ez Enter the total rent paid 6a. Turbo tax ez       b. Turbo tax ez Enter the fair rental value of the home. Turbo tax ez If the person you supported owned the home,  also include this amount in line 21 6b. Turbo tax ez     7. Turbo tax ez Enter the total food expenses 7. Turbo tax ez     8. Turbo tax ez Enter the total amount of utilities (heat, light, water, etc. Turbo tax ez not included in line 6a or 6b) 8. Turbo tax ez     9. Turbo tax ez Enter the total amount of repairs (not included in line 6a or 6b) 9. Turbo tax ez     10. Turbo tax ez Enter the total of other expenses. Turbo tax ez Do not include expenses of maintaining the home, such as mortgage interest, real estate taxes, and insurance 10. Turbo tax ez     11. Turbo tax ez Add lines 6a through 10. Turbo tax ez These are the total household expenses 11. Turbo tax ez     12. Turbo tax ez Enter total number of persons who lived in the household 12. Turbo tax ez     Expenses for the Person You Supported       13. Turbo tax ez Divide line 11 by line 12. Turbo tax ez This is the person's share of the household expenses 13. Turbo tax ez     14. Turbo tax ez Enter the person's total clothing expenses 14. Turbo tax ez     15. Turbo tax ez Enter the person's total education expenses 15. Turbo tax ez     16. Turbo tax ez Enter the person's total medical and dental expenses not paid for or reimbursed by insurance 16. Turbo tax ez     17. Turbo tax ez Enter the person's total travel and recreation expenses 17. Turbo tax ez     18. Turbo tax ez Enter the total of the person's other expenses 18. Turbo tax ez     19. Turbo tax ez Add lines 13 through 18. Turbo tax ez This is the total cost of the person's support for the year 19. Turbo tax ez     Did the Person Provide More Than Half of His or Her Own Support?       20. Turbo tax ez Multiply line 19 by 50% (. Turbo tax ez 50) 20. Turbo tax ez     21. Turbo tax ez Enter the amount from line 2, plus the amount from line 6b if the person you supported owned  the home. Turbo tax ez This is the amount the person provided for his or her own support 21. Turbo tax ez     22. Turbo tax ez Is line 21 more than line 20?   No. Turbo tax ez You meet the support test for this person to be your qualifying child. Turbo tax ez If this person also meets the other tests to be a qualifying child, stop here; do not complete lines 23–26. Turbo tax ez Otherwise, go to line 23 and fill out the rest of the worksheet to determine if this person is your qualifying relative. Turbo tax ez    Yes. Turbo tax ez You do not meet the support test for this person to be either your qualifying child or your qualifying relative. Turbo tax ez Stop here. Turbo tax ez        Did You Provide More Than Half?       23. Turbo tax ez Enter the amount others provided for the person's support. Turbo tax ez Include amounts provided by state, local, and other welfare societies or agencies. Turbo tax ez Do not include any amounts included on line 1 23. Turbo tax ez     24. Turbo tax ez Add lines 21 and 23 24. Turbo tax ez     25. Turbo tax ez Subtract line 24 from line 19. Turbo tax ez This is the amount you provided for the person's support 25. Turbo tax ez     26. Turbo tax ez Is line 25 more than line 20?   Yes. Turbo tax ez You meet the support test for this person to be your qualifying relative. Turbo tax ez    No. Turbo tax ez You do not meet the support test for this person to be your qualifying relative. Turbo tax ez You cannot claim an exemption for this person unless you can do so under a multiple support agreement, the support test for children of divorced or separated parents, or the special rule for kidnapped children. Turbo tax ez See Multiple Support Agreement or Support Test for Children of Divorced or Separated Parents (or Parents Who Live Apart) , or Kidnapped child under Qualifying Relative. Turbo tax ez   Example. Turbo tax ez You provided $4,000 toward your 16-year-old son's support for the year. Turbo tax ez He has a part-time job and provided $6,000 to his own support. Turbo tax ez He provided more than half of his own support for the year. Turbo tax ez He is not your qualifying child. Turbo tax ez Foster care payments and expenses. Turbo tax ez   Payments you receive for the support of a foster child from a child placement agency are considered support provided by the agency. Turbo tax ez Similarly, payments you receive for the support of a foster child from a state or county are considered support provided by the state or county. Turbo tax ez   If you are not in the trade or business of providing foster care and your unreimbursed out-of-pocket expenses in caring for a foster child were mainly to benefit an organization qualified to receive deductible charitable contributions, the expenses are deductible as charitable contributions but are not considered support you provided. Turbo tax ez For more information about the deduction for charitable contributions, see chapter 24. Turbo tax ez If your unreimbursed expenses are not deductible as charitable contributions, they may qualify as support you provided. Turbo tax ez   If you are in the trade or business of providing foster care, your unreimbursed expenses are not considered support provided by you. Turbo tax ez Example 1. Turbo tax ez Lauren, a foster child, lived with Mr. Turbo tax ez and Mrs. Turbo tax ez Smith for the last 3 months of the year. Turbo tax ez The Smiths cared for Lauren because they wanted to adopt her (although she had not been placed with them for adoption). Turbo tax ez They did not care for her as a trade or business or to benefit the agency that placed her in their home. Turbo tax ez The Smiths' unreimbursed expenses are not deductible as charitable contributions but are considered support they provided for Lauren. Turbo tax ez Example 2. Turbo tax ez You provided $3,000 toward your 10-year-old foster child's support for the year. Turbo tax ez The state government provided $4,000, which is considered support provided by the state, not by the child. Turbo tax ez See Support provided by the state (welfare, food stamps, housing, etc. Turbo tax ez ) , later. Turbo tax ez Your foster child did not provide more than half of her own support for the year. Turbo tax ez Scholarships. Turbo tax ez   A scholarship received by a child who is a student is not taken into account in determining whether the child provided more than half of his or her own support. Turbo tax ez Joint Return Test (To Be a Qualifying Child) To meet this test, the child cannot file a joint return for the year. Turbo tax ez Exception. Turbo tax ez   An exception to the joint return test applies if your child and his or her spouse file a joint return only to claim a refund of income tax withheld or estimated tax paid. Turbo tax ez Example 1—child files joint return. Turbo tax ez You supported your 18-year-old daughter, and she lived with you all year while her husband was in the Armed Forces. Turbo tax ez He earned $25,000 for the year. Turbo tax ez The couple files a joint return. Turbo tax ez Because your daughter and her husband file a joint return, she is not your qualifying child. Turbo tax ez Example 2—child files joint return only as a claim for refund of withheld tax. Turbo tax ez Your 18-year-old son and his 17-year-old wife had $800 of wages from part-time jobs and no other income. Turbo tax ez Neither is required to file a tax return. Turbo tax ez They do not have a child. Turbo tax ez Taxes were taken out of their pay so they filed a joint return only to get a refund of the withheld taxes. Turbo tax ez The exception to the joint return test applies, so your son may be your qualifying child if all the other tests are met. Turbo tax ez Example 3—child files joint return to claim American opportunity credit. Turbo tax ez The facts are the same as in Example 2 except no taxes were taken out of your son's pay. Turbo tax ez He and his wife were not required to file a tax return. Turbo tax ez However, they file a joint return to claim an American opportunity credit of $124 and get a refund of that amount. Turbo tax ez Because claiming the American opportunity credit is their reason for filing the return, they are not filing it only to get a refund of income tax withheld or estimated tax paid. Turbo tax ez The exception to the joint return test does not apply, so your son is not your qualifying child. Turbo tax ez Special Rule for Qualifying Child of More Than One Person If your qualifying child is not a qualifying child of anyone else, this special rule does not apply to you and you do not need to read about it. Turbo tax ez This is also true if your qualifying child is not a qualifying child of anyone else except your spouse with whom you file a joint return. Turbo tax ez If a child is treated as the qualifying child of the noncustodial parent under the rules for children of divorced or separated parents (or parents who live apart) described earlier, see Applying this special rule to divorced or separated parents (or parents who live apart), later. Turbo tax ez Sometimes, a child meets the relationship, age, residency, support, and joint return tests to be a qualifying child of more than one person. Turbo tax ez Although the child is a qualifying child of each of these persons, only one person can actually treat the child as a qualifying child to take all of the following tax benefits (provided the person is eligible for each benefit). Turbo tax ez The exemption for the child. Turbo tax ez The child tax credit. Turbo tax ez Head of household filing status. Turbo tax ez The credit for child and dependent care expenses. Turbo tax ez The exclusion from income for dependent care benefits. Turbo tax ez The earned income credit. Turbo tax ez The other person cannot take any of these benefits based on this qualifying child. Turbo tax ez In other words, you and the other person cannot agree to divide these benefits between you. Turbo tax ez The other person cannot take any of these tax benefits for a child unless he or she has a different qualifying child. Turbo tax ez Tiebreaker rules. Turbo tax ez   To determine which person can treat the child as a qualifying child to claim these six tax benefits, the following tiebreaker rules apply. Turbo tax ez If only one of the persons is the child's parent, the child is treated as the qualifying child of the parent. Turbo tax ez If the parents file a joint return together and can claim the child as a qualifying child, the child is treated as the qualifying child of the parents. Turbo tax ez If the parents do not file a joint return together but both parents claim the child as a qualifying child, the IRS will treat the child as the qualifying child of the parent with whom the child lived for the longer period of time during the year. Turbo tax ez If the child lived with each parent for the same amount of time, the IRS will treat the child as the qualifying child of the parent who had the higher adjusted gross income (AGI) for the year. Turbo tax ez If no parent can claim the child as a qualifying child, the child is treated as the qualifying child of the person who had the highest AGI for the year. Turbo tax ez If a parent can claim the child as a qualifying child but no parent does so claim the child, the child is treated as the qualifying child of the person who had the highest AGI for the year, but only if that person's AGI is higher than the highest AGI of any of the child's parents who can claim the child. Turbo tax ez If the child's parents file a joint return with each other, this rule can be applied by dividing the parents' combined AGI equally between the parents. Turbo tax ez See Example 6 . Turbo tax ez   Subject to these tiebreaker rules, you and the other person may be able to choose which of you claims the child as a qualifying child. Turbo tax ez Example 1—child lived with parent and grandparent. Turbo tax ez You and your 3-year-old daughter Jane lived with your mother all year. Turbo tax ez You are 25 years old, unmarried, and your AGI is $9,000. Turbo tax ez Your mother's AGI is $15,000. Turbo tax ez Jane's father did not live with you or your daughter. Turbo tax ez You have not signed Form 8332 (or a similar statement) to release the child's exemption to the noncustodial parent. Turbo tax ez Jane is a qualifying child of both you and your mother because she meets the relationship, age, residency, support, and joint return tests for both you and your mother. Turbo tax ez However, only one of you can claim her. Turbo tax ez Jane is not a qualifying child of anyone else, including her father. Turbo tax ez You agree to let your mother claim Jane. Turbo tax ez This means your mother can claim Jane as a qualifying child for all of the six tax benefits listed earlier, if she qualifies (and if you do not claim Jane as a qualifying child for any of those tax benefits). Turbo tax ez Example 2—parent has higher AGI than grandparent. Turbo tax ez The facts are the same as in Example 1 except your AGI is $18,000. Turbo tax ez Because your mother's AGI is not higher than yours, she cannot claim Jane. Turbo tax ez Only you can claim Jane. Turbo tax ez Example 3—two persons claim same child. Turbo tax ez The facts are the same as in Example 1 except that you and your mother both claim Jane as a qualifying child. Turbo tax ez In this case, you, as the child's parent, will be the only one allowed to claim Jane as a qualifying child. Turbo tax ez The IRS will disallow your mother's claim to the six tax benefits listed earlier unless she has another qualifying child. Turbo tax ez Example 4—qualifying children split between two persons. Turbo tax ez The facts are the same as in Example 1 except you also have two other young children who are qualifying children of both you and your mother. Turbo tax ez Only one of you can claim each child. Turbo tax ez However, if your mother's AGI is higher than yours, you can allow your mother to claim one or more of the children. Turbo tax ez For example, if you claim one child, your mother can claim the other two. Turbo tax ez Example 5—taxpayer who is a qualifying child. Turbo tax ez The facts are the same as in Example 1 except you are only 18 years old and did not provide more than half of your own support for the year. Turbo tax ez This means you are your mother's qualifying child. Turbo tax ez If she can claim you as a dependent, then you cannot claim your daughter as a dependent because of the Dependent Taxpayer Test explained earlier. Turbo tax ez Example 6—child lived with both parents and grandparent. Turbo tax ez The facts are the same as in Example 1 except you are married to your daughter's father. Turbo tax ez The two of you live together with your daughter and your mother, and have an AGI of $20,000 on a joint return. Turbo tax ez If you and your husband do not claim your daughter as a qualifying child, your mother can claim her instead. Turbo tax ez Even though the AGI on your joint return, $20,000, is more than your mother's AGI of $15,000, for this purpose each parent's AGI can be treated as $10,000, so your mother's $15,000 AGI is treated as higher than the highest AGI of any of the child's parents who can claim the child. Turbo tax ez Example 7—separated parents. Turbo tax ez You, your husband, and your 10-year-old son lived together until August 1, 2013, when your husband moved out of the household. Turbo tax ez In August and September, your son lived with you. Turbo tax ez For the rest of the year, your son lived with your husband, the boy's father. Turbo tax ez Your son is a qualifying child of both you and your husband because your son lived with each of you for more than half the year and because he met the relationship, age, support, and joint return tests for both of you. Turbo tax ez At the end of the year, you and your husband still were not divorced, legally separated, or separated under a written separation agreement, so the rule for children of divorced or separated parents (or parents who live apart) does not apply. Turbo tax ez You and your husband will file separate returns. Turbo tax ez Your husband agrees to let you treat your son as a qualifying child. Turbo tax ez This means, if your husband does not claim your son as a qualifying child, you can claim your son as a qualifying child for the dependency exemption, child tax credit, and exclusion for dependent care benefits (if you qualify for each of those tax benefits). Turbo tax ez However, you cannot claim head of household filing status because you and your husband did not live apart for the last 6 months of the year. Turbo tax ez As a result, your filing status is married filing separately, so you cannot claim the earned income credit or the credit for child and dependent care expenses. Turbo tax ez Example 8—separated parents claim same child. Turbo tax ez The facts are the same as in Example 7 except that you and your husband both claim your son as a qualifying child. Turbo tax ez In this case, only your husband will be allowed to treat your son as a qualifying child. Turbo tax ez This is because, during 2013, the boy lived with him longer than with you. Turbo tax ez If you claimed an exemption or the child tax credit for your son, the IRS will disallow your claim to both these tax benefits. Turbo tax ez If you do not have another qualifying child or dependent, the IRS will also disallow your claim to the exclusion for dependent care benefits. Turbo tax ez In addition, because you and your husband did not live apart for the last 6 months of the year, your husband cannot claim head of household filing status. Turbo tax ez As a result, his filing status is married filing separately, so he cannot claim the earned income credit or the credit for child and dependent care expenses. Turbo tax ez Example 9—unmarried parents. Turbo tax ez You, your 5-year-old son, and your son's father lived together all year. Turbo tax ez You and your son's father are not married. Turbo tax ez Your son is a qualifying child of both you and his father because he meets the relationship, age, residency, support, and joint return tests for both you and his father. Turbo tax ez Your AGI is $12,000 and your son's father's AGI is $14,000. Turbo tax ez Your son's father agrees to let you claim the child as a qualifying child. Turbo tax ez This means you can claim him as a qualifying child for the dependency exemption, child tax credit, head of household filing status, credit for child and dependent care expenses, exclusion for dependent care benefits, and the earned income credit, if you qualify for each of those tax benefits (and if your son's father does not, in fact, claim your son as a qualifying child for any of those tax benefits). Turbo tax ez Example 10—unmarried parents claim same child. Turbo tax ez The facts are the same as in Example 9 except that you and your son's father both claim your son as a qualifying child. Turbo tax ez In this case, only your son's father will be allowed to treat your son as a qualifying child. Turbo tax ez This is because his AGI, $14,000, is more than your AGI, $12,000. Turbo tax ez If you claimed an exemption or the child tax credit for your son, the IRS will disallow your claim to both these tax benefits. Turbo tax ez If you do not have another qualifying child or dependent, the IRS will also disallow your claim to the earned income credit, head of household filing status, the credit for child and dependent care expenses, and the exclusion for dependent care benefits. Turbo tax ez Example 11—child did not live with a parent. Turbo tax ez You and your 7-year-old niece, your sister's child, lived with your mother all year. Turbo tax ez You are 25 years old, and your AGI is $9,300. Turbo tax ez Your mother's AGI is $15,000. Turbo tax ez Your niece's parents file jointly, have an AGI of less than $9,000, and do not live with you or their child. Turbo tax ez Your niece is a qualifying child of both you and your mother because she meets the relationship, age, residency, support, and joint return tests for both you and your mother. Turbo tax ez However, only your mother can treat her as a qualifying child. Turbo tax ez This is because your mother's AGI, $15,000, is more than your AGI, $9,300. Turbo tax ez Applying this special rule to divorced or separated parents (or parents who live apart). Turbo tax ez   If a child is treated as the qualifying child of the noncustodial parent under the rules described earlier for children of divorced or separated parents (or parents who live apart), only the noncustodial parent can claim an exemption and the child tax credit for the child. Turbo tax ez However, the custodial parent, if eligible, or other eligible person can claim the child as a qualifying child for head of household filing status, the credit for child and dependent care expenses, the exclusion for dependent care benefits, and the earned income credit. Turbo tax ez If the child is the qualifying child of more than one person for these benefits, then the tiebreaker rules just explained determine which person can treat the child as a qualifying child. Turbo tax ez Example 1. Turbo tax ez You and your 5-year-old son lived all year with your mother, who paid the entire cost of keeping up the home. Turbo tax ez Your AGI is $10,000. Turbo tax ez Your mother's AGI is $25,000. Turbo tax ez Your son's father did not live with you or your son. Turbo tax ez Under the rules explained earlier for children of divorced or separated parents (or parents who live apart), your son is treated as the qualifying child of his father, who can claim an exemption and the child tax credit for him. Turbo tax ez Because of this, you cannot claim an exemption or the child tax credit for your son. Turbo tax ez However, your son's father cannot claim your son as a qualifying child for head of household filing status, the credit for child and dependent care expenses, the exclusion for dependent care benefits, or the earned income credit. Turbo tax ez You and your mother did not have any child care expenses or dependent care benefits, so neither of you can claim the credit for child and dependent care expenses or the exclusion for dependent care benefits. Turbo tax ez But the boy is a qualifying child of both you and your mother for head of household filing status and the earned income credit because he meets the relationship, age, residency, support, and joint return tests for both you and your mother. Turbo tax ez (Note: The support test does not apply for the earned income credit. Turbo tax ez ) However, you agree to let your mother claim your son. Turbo tax ez This means she can claim him for head of household filing status and the earned income credit if she qualifies for each and if you do not claim him as a qualifying child for the earned income credit. Turbo tax ez (You cannot claim head of household filing status because your mother paid the entire cost of keeping up the home. Turbo tax ez ) Example 2. Turbo tax ez The facts are the same as in Example 1 except your AGI is $25,000 and your mother's AGI is $21,000. Turbo tax ez Your mother cannot claim your son as a qualifying child for any purpose because her AGI is not higher than yours. Turbo tax ez Example 3. Turbo tax ez The facts are the same as in Example 1 except you and your mother both claim your son as a qualifying child for the earned income credit. Turbo tax ez Your mother also claims him as a qualifying child for head of household filing status. Turbo tax ez You, as the child's parent, will be the only one allowed to claim your son as a qualifying child for the earned income credit. Turbo tax ez The IRS will disallow your mother's claim to the earned income credit and head of household filing status unless she has another qualifying child. Turbo tax ez Qualifying Relative Four tests must be met for a person to be your qualifying relative. Turbo tax ez The four tests are: Not a qualifying child test, Member of household or relationship test, Gross income test, and Support test. Turbo tax ez Age. Turbo tax ez   Unlike a qualifying child, a qualifying relative can be any age. Turbo tax ez There is no age test for a qualifying relative. Turbo tax ez Kidnapped child. Turbo tax ez   You may be able to treat a child as your qualifying relative even if the child has been kidnapped. Turbo tax ez See Publication 501 for details. Turbo tax ez Not a Qualifying Child Test A child is not your qualifying relative if the child is your qualifying child or the qualifying child of any other taxpayer. Turbo tax ez Example 1. Turbo tax ez Your 22-year-old daughter, who is a student, lives with you and meets all the tests to be your qualifying child. Turbo tax ez She is not your qualifying relative. Turbo tax ez Example 2. Turbo tax ez Your 2-year-old son lives with your parents and meets all the tests to be their qualifying child. Turbo tax ez He is not your qualifying relative. Turbo tax ez Example 3. Turbo tax ez Your son lives with you but is not your qualifying child because he is 30 years old and does not meet the age test. Turbo tax ez He may be your qualifying relative if the gross income test and the support test are met. Turbo tax ez Example 4. Turbo tax ez Your 13-year-old grandson lived with his mother for 3 months, with his uncle for 4 months, and with you for 5 months during the year. Turbo tax ez He is not your qualifying child because he does not meet the residency test. Turbo tax ez He may be your qualifying relative if the gross income test and the support test are met. Turbo tax ez Child of person not required to file a return. Turbo tax ez   A child is not the qualifying child of any other taxpayer and so may qualify as your qualifying relative if the child's parent (or other person for whom the child is defined as a qualifying child) is not required to file an income tax return and either: Does not file an income tax return, or Files a return only to get a refund of income tax withheld or estimated tax paid. Turbo tax ez Example 1—return not required. Turbo tax ez You support an unrelated friend and her 3-year-old child, who lived with you all year in your home. Turbo tax ez Your friend has no gross income, is not required to file a 2013 tax return, and does not file a 2013 tax return. Turbo tax ez Both your friend and her child are your qualifying relatives if the support test is met. Turbo tax ez Example 2—return filed to claim refund. Turbo tax ez The facts are the same as in Example 1 except your friend had wages of $1,500 during the year and had income tax withheld from her wages. Turbo tax ez She files a return only to get a refund of the income tax withheld and does not claim the earned income credit or any other tax credits or deductions. Turbo tax ez Both your friend and her child are your qualifying relatives if the support test is met. Turbo tax ez Example 3—earned income credit claimed. Turbo tax ez The facts are the same as in Example 2 except your friend had wages of $8,000 during the year and claimed the earned income credit on her return. Turbo tax ez Your friend's child is the qualifying child of another taxpayer (your friend), so you cannot claim your friend's child as your qualifying relative. Turbo tax ez Child in Canada or Mexico. Turbo tax ez   You may be able to claim your child as a dependent even if the child lives in Canada or Mexico. Turbo tax ez If the child does not live with you, the child does not meet the residency test to be your qualifying child. Turbo tax ez However, the child may still be your qualifying relative. Turbo tax ez If the persons the child does live with are not U. Turbo tax ez S. Turbo tax ez citizens and have no U. Turbo tax ez S. Turbo tax ez gross income, those persons are not “taxpayers,” so the child is not the qualifying child of any other taxpayer. Turbo tax ez If the child is not the qualifying child of any other taxpayer, the child is your qualifying relative as long as the gross income test and the support test are met. Turbo tax ez   You cannot claim as a dependent a child who lives in a foreign country other than Canada or Mexico, unless the child is a U. Turbo tax ez S. Turbo tax ez citizen, U. Turbo tax ez S. Turbo tax ez resident alien, or U. Turbo tax ez S. Turbo tax ez national. Turbo tax ez There is an exception for certain adopted children who lived with you all year. Turbo tax ez See Citizen or Resident Test , earlier. Turbo tax ez Example. Turbo tax ez You provide all the support of your children, ages 6, 8, and 12, who live in Mexico with your mother and have no income. Turbo tax ez You are single and live in the United States. Turbo tax ez Your mother is not a U. Turbo tax ez S. Turbo tax ez citizen and has no U. Turbo tax ez S. Turbo tax ez income, so she is not a “taxpayer. Turbo tax ez ” Your children are not your qualifying children because they do not meet the residency test. Turbo tax ez But since they are not the qualifying children of any other taxpayer, they are your qualifying relatives and you can claim them as dependents. Turbo tax ez You may also be able to claim your mother as a dependent if the gross income and support tests are met. Turbo tax ez Member of Household or Relationship Test 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 . Turbo tax ez If at any time during the year the person was your spouse, that person cannot be your qualifying relative. Turbo tax ez However, see Personal Exemptions , earlier. Turbo tax ez Relatives who do not have to live with you. Turbo tax ez   A person related to you in any of the following ways does not have to live with you all year as a member of your household to meet this test. Turbo tax ez Your child, stepchild, foster child, or a descendant of any of them (for example, your grandchild). Turbo tax ez (A legally adopted child is considered your child. Turbo tax ez ) Your brother, sister, half brother, half sister, stepbrother, or stepsister. Turbo tax ez Your father, mother, grandparent, or other direct ancestor, but not foster parent. Turbo tax ez Your stepfather or stepmother. Turbo tax ez A son or daughter of your brother or sister. Turbo tax ez A son or daughter of your half brother or half sister. Turbo tax ez A brother or sister of your father or mother. Turbo tax ez Your son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law. Turbo tax ez Any of these relationships that were established by marriage are not ended by death or divorce. Turbo tax ez Example. Turbo tax ez You and your wife began supporting your wife's father, a widower, in 2006. Turbo tax ez Your wife died in 2012. Turbo tax ez Despite your wife's death, your father-in-law continues to meet this test, even if he does not live with you. Turbo tax ez You can claim him as a dependent if all other tests are met, including the gross income test and support test. Turbo tax ez Foster child. Turbo tax ez   A foster child is an individual who is placed with you by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction. Turbo tax ez Joint return. Turbo tax ez   If you file a joint return, the person can be related to either you or your spouse. Turbo tax ez Also, the person does not need to be related to the spouse who provides support. Turbo tax ez   For example, your spouse's uncle who receives more than half of his support from you may be your qualifying relative, even though he does not live with you. Turbo tax ez However, if you and your spouse file separate returns, your spouse's uncle can be your qualifying relative only if he lives with you all year as a member of your household. Turbo tax ez Temporary absences. Turbo tax ez   A person is considered to live with you as a member of your household during periods of time when one of you, or both, are temporarily absent due to special circumstances such as: Illness, Education, Business, Vacation, or Military service. Turbo tax ez   If the person is placed in a nursing home for an indefinite period of time to receive constant medical care, the absence may be considered temporary. Turbo tax ez Death or birth. Turbo tax ez   A person who died during the year, but lived with you as a member of your household until death, will meet this test. Turbo tax ez The same is true for a child who was born during the year and lived with you as a member of your household for the rest of the year. Turbo tax ez The test is also met if a child lived with you as a member of your household except for any required hospital stay following birth. Turbo tax ez   If your dependent died during the year and you otherwise qualify to claim an exemption for the dependent, you can still claim the exemption. Turbo tax ez Example. Turbo tax ez Your dependent mother died on January 15. Turbo tax ez She met the tests to be your qualifying relative. Turbo tax ez The other tests to claim an exemption for a dependent were also met. Turbo tax ez You can claim an exemption for her on your return. Turbo tax ez Local law violated. Turbo tax ez   A person does not meet this test if at any time during the year the relationship between you and that person violates local law. Turbo tax ez Example. Turbo tax ez Your girlfriend lived with you as a member of your household all year. Turbo tax ez However, your relationship with her violated the laws of the state where you live, because she was married to someone else. Turbo tax ez Therefore, she does not meet this test and you cannot claim her as a dependent. Turbo tax ez Adopted child. Turbo tax ez   An adopted child is always treated as your own child. Turbo tax ez The term “adopted child” includes a child who was lawfully placed with you for legal adoption. Turbo tax ez Cousin. Turbo tax ez   Your cousin meets this test only if he or she lives with you all year as a member of your household. Turbo tax ez A cousin is a descendant of a brother or sister of your father or mother. Turbo tax ez Gross Income Test To meet this test, a person's gross income for the year must be less than $3,900. Turbo tax ez Gross income defined. Turbo tax ez   Gross income is all income in the form of money, property, and services that is not exempt from tax. Turbo tax ez   In a manufacturing, merchandising, or mining business, gross income is the total net sales minus the cost of goods sold, plus any miscellaneous income from the business. Turbo tax ez   Gross receipts from rental property are gross income. Turbo tax ez Do not deduct taxes, repairs, or other expenses, to determine the gross income from rental property. Turbo tax ez   Gross income includes a partner's share of the gross (not a share of the net) partnership income. Turbo tax ez    Gross income also includes all taxable unemployment compensation and certain scholarship and fellowship grants. Turbo tax ez Scholarships received by degree candidates and used for tuition, fees, supplies, books, and equipment required for particular courses generally are not included in gross income. Turbo tax ez For more information about scholarships, see chapter 12. Turbo tax ez   Tax-exempt income, such as certain social security benefits, is not included in gross income. Turbo tax ez Disabled dependent working at sheltered workshop. Turbo tax ez   For purposes of the gross income test, the gross income of an individual who is permanently and totally disabled at any time during the year does not include income for services the individual performs at a sheltered workshop. Turbo tax ez The availability of medical care at the workshop must be the main reason for the individual's presence there. Turbo tax ez Also, the income must come solely from activities at the workshop that are incident to this medical care. Turbo tax ez   A “sheltered workshop” is a school that: Provides special instruction or training designed to alleviate the disability of the individual, and Is operated by certain tax-exempt organizations, or by a state, a U. Turbo tax ez S. Turbo tax ez possession, a political subdivision of a state or possession, the United States, or the District of Columbia. Turbo tax ez “Permanently and totally disabled” has the same meaning here as under Qualifying Child, earlier. Turbo tax ez Support Test (To Be a Qualifying Relative) To meet this test, you generally must provide more than half of a person's total support during the calendar year. Turbo tax ez However, if two or more persons provide support, but no one person provides more than half of a person's total support, see Multiple Support Agreement , later. Turbo tax ez How to determine if support test is met. Turbo tax ez   You figure whether you have provided more than half of a person's total support by comparing the amount you contributed to that person's support with the entire amount of support that person received from all sources. Turbo tax ez This includes support the person provided from his or her own funds. Turbo tax ez   You may find Worksheet 3-1 helpful in figuring whether you provided more than half of a person's support. Turbo tax ez Person's own funds not used for support. Turbo tax ez   A person's own funds are not support unless they are actually spent for support. Turbo tax ez Example. Turbo tax ez Your mother received $2,400 in social security benefits and $300 in interest. Turbo tax ez She paid $2,000 for lodging and $400 for recreation. Turbo tax ez She put $300 in a savings account. Turbo tax ez Even though your mother received a total of $2,700 ($2,400 + $300), she spent only $2,400 ($2,000 + $400) for her own support. Turbo tax ez If you spent more than $2,400 for her support and no other support was received, you have provided more than half of her support. Turbo tax ez Child's wages used for own support. Turbo tax ez   You cannot include in your contribution to your child's support any support paid for by the child with the child's own wages, even if you paid the wages. Turbo tax ez Year support is provided. Turbo tax ez   The year you provide the support is the year you pay for it, even if you do so with borrowed money that you repay in a later year. Turbo tax ez   If you use a fiscal year to report your income, you must provide more than half of the dependent's support for the calendar year in which your fiscal year begins. Turbo tax ez Armed Forces dependency allotments. Turbo tax ez   The part of the allotment contributed by the government and the part taken out of your military pay are both considered provided by you in figuring whether you provide more than half of the support. Turbo tax ez If your allotment is used to support persons other than those you name, you can take the exemptions for them if they otherwise qualify. Turbo tax ez Example. Turbo tax ez You are in the Armed Forces. Turbo tax ez You authorize an allotment for your widowed mother that she uses to support herself and her sister. Turbo tax ez If the allotment provides more than half of each person's support, you can take an exemption for each of them, if they otherwise qualify, even though you authorize the allotment only for your mother. Turbo tax ez Tax-exempt military quarters allowances. Turbo tax ez   These allowances are treated the same way as dependency allotments in figuring support. Turbo tax ez The allotment of pay and the tax-exempt basic allowance for quarters are both considered as provided by you for support. Turbo tax ez Tax-exempt income. Turbo tax ez   In figuring a person's total support, include tax-exempt income, savings, and borrowed amounts used to support that person. Turbo tax ez Tax-exempt income includes certain social security benefits, welfare benefits, nontaxable life insurance proceeds, Armed Forces family allotments, nontaxable pensions, and tax-exempt interest. Turbo tax ez Example 1. Turbo tax ez You provide $4,000 toward your mother's support during the year. Turbo tax ez She has earned income of $600, nontaxable social security benefits of $4,800, and tax-exempt interest of $200. Turbo tax ez She uses all these for her support. Turbo tax ez You cannot claim an exemption for your mother because the $4,000 you provide is not more than half of her total support of $9,600 ($4,000 + $600 + $4,800 + $200). Turbo tax ez Example 2. Turbo tax ez Your niece takes out a student loan of $2,500 a