Why do I need to know who is a "qualifying child?"
If you have children, there are some tax credits you might be able to claim. To do this, you need to figure out if your child meets the definition the IRS uses for a "qualifying child." This guide explains what that means.
Which tax credits use this definition?
There are five child-related tax credits. The IRS has a standard definition of what makes a child a “qualifying child.” This means they use the same one for all five credits. The credits are:
- Dependent exemption
- Head-of-household filing status
- Earned Income Credit (EIC)
- Child tax credit (CTC)
- Credit for child and dependent care expenses
Who is a "qualifying child?"
We use four basic tests to tell if a child is a “qualifying child.” In general, ALL four tests must be met to claim someone as a qualifying child. Then, each credit also has some extra rules that must be true in order to claim a child.
The Four Tests
To meet the relationship test, a child must be your:
- a descendent of one of these relatives (like nieces, nephews, grandchildren, etc.)
Adopted children and foster children both fall under 'child.'
An adopted child includes a child placed with you for legal adoption even if the adoption is not final.
An eligible foster child is any child who is placed with you by an authorized placement agency or by the court.
To meet the age test, the child must be:
- Under age 19 at the end of the year and younger than you (or your spouse, if you file jointly),
- A student under age 24 at the end of the year and younger than you (or your spouse, if you file jointly), or
- Permanently and totally disabled at any time during the year, no matter what age.
A student is any child who, during any 5 months of the year:
- Was enrolled as a full-time student at a school, or
- Took a full-time on-farm training course from a school or a state, county, or local government agency.
A school includes a technical, trade, or mechanical school. It does not include an on-the-job training course, correspondence school, or night school.
The child must live with you. They must live with you for more than half the year. Some times when a child doesn't live at home count toward this. Some examples of reasons why a child isn't living at home are:
- medical care
- military service
- detention in a juvenile facility
A child who was born or died during the year is counted as living with you for the entire year if your home was the child's home for the entire time they were alive. There are some exceptions for children of divorced or separated parents and parents of kidnapped children.
You must have supported the child financially. The child cannot have provided over half of their own support during the year.
The support test does not apply to the Earned Income Credit. Only the Age, Relationship, and Residency tests apply for the Earned Income Credit.
Qualifying Child of more than one person
Sometimes a child meets the tests to be a qualifying child of more than one person. But, only one person can treat that child as a qualifying child.
If you and someone else (other than your spouse if filing jointly) can both claim a child, you and the other person(s) can decide which of you will claim the child. If you can't agree on who will claim the child and more than one person files a return using the same child, the IRS may deny one or more of the claims using the tie-breaker rule.
When more than one person could claim a child as a qualifying child, the IRS uses these rules to decide who will be able to claim the child on their taxes.
- If only one person is the child's parent, then the child will be treated as the qualifying child of the parent.
- If both persons are the child's parent, then the child will be treated as the qualifying child of the parent the child has lived for the longer period of time.
- If the child lived with each parent for the same amount of time, then the child will be treated as the qualifying child of the parent with the higher income.
- If none of the persons are the child's parent, then the child will be treated as the qualifying child of the person with the highest Adjusted Gross Income (AGI).
Special Rules for Separated or Divorced Parents
Separated parents and the Earned Income Credit (EIC)
Parents who are separated (but not divorced) and who file as “married filing separately” cannot claim the Earned Income Credit. To claim the EIC, they must file as “married filing jointly.”
Another possible option for claiming the EIC is to file as “head of household.” But to do this, you must meet these tests:
1. You must have lived apart from the other parent for at least 6 months of the tax year.
2. Your child must have lived with one of you for more than half the year.
3. You must have paid more than half the cost of maintaining the household during the tax year.
4. You must be able to claim the child as a dependent.
Divorced parents and the Child Tax Credit (CTC)
The dependent exemption and CTC are normally given to the parent the child lived most of the time. But, these tax credits can be transferred to the non-custodial parent if the custodial parent signs Form 8332.
When a non-custodial parent is allowed to claim the child as a dependent by a divorce or separate maintenance agreement or judgment, they may also claim the CTC. Again, the custodial parent must sign IRS Form 8332, “Release of Claim for Child of Divorced or Separated Parents,” and this signed form must be attached to the tax return of the non-custodial parent.
IMPORTANT NOTE: This does not change the fact that only the custodial parent (if otherwise eligible) can claim the Earned Income Credit. See “The Four Tests” above.
While the four above tests generally apply for the five tax benefits noted above, there are some additions or variations for each of the five tax credits that relate to having a “qualifying child.” Some of these are listed here:
Credit for Child and Dependent Care Expenses
A qualifying child must be under the age of 13 or permanently and totally disabled.
Child Tax Credit
A qualifying child must be under age 17 and a U.S. citizen, national or a U.S. resident.
Earned Income Tax Credit
A qualifying child does not have to meet the Support Test. Also, a qualifying child must have lived with the taxpayer in the United States for more than half the year.
Updated September 2022
PTLA # 248