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Dear Wendel,
I remember seeing the movie "Cheaper By The Dozen" and thinking that it would be great to have a busy house - I cried 'Uncle' after the third child.
Your question has many things that a tax expert would need to discuss with you - I highly advise this. However, I want to take this opportunity to explain 2 issues that you will need to consider for this tax season. With all of the people that you describe as living in you home you may be able to claim all or some of them as your dependent. There are 2 basic types of dependents available to you: Qualifying Child & Qualifying Relative.
First, Qualifying Child: There are 5 test that ned to be met before a child can be considered your dependent.
- Relationship Test
- Age Test
- Principal Place of Abode Test
- Support Test
- Join Return Test
- Your child, step-child, or decedent of either a
- Your sibling, step-sibling, or decent of either satisfies the relationship test.
- This also include foster or adopted children as well.
- Be younger than the taxpayer
- Younger than age 19 (or a full-time student under 24 years of age)
- This test is suspended for anyone who is permanently disabled at at anytime during the year.
- More than one-half of the year.
- Must not have provided for more than 1/2 of there support for the year.
- The dependent must not have filed a Joint Return with their spouse except as a claim for refund.
These are the basics of claiming a person as a Qualifying Child for dependent status. In the next post I will continue answering your question as I will describe who is a Qualifying Relative.
John
PS. I highly suggest talking through the issues with a tax professional - Email me.
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