There are two types of dependents, "Qualifying Children"(QC) and
standard ("Qualifying Relative" in IRS parlance even though they
don't have to actually be related). There is no income limit for a QC but there
is an age limit, a relationship test and a residence
test. There is no residence test for a related standard dependent.
A person can still be a Qualifying
relative dependent, if not a Qualifying Child, if he meets the 6 tests for
claiming a dependent:
1. Closely Related OR live
with the taxpayer ALL year
2. His/her gross taxable income for the year must be less than $4150 ($4,050 in 2016-17)
3. The taxpayer must have
provided more than 1/2 his support
4. He must be a US citizen or resident of the US, Canada
or Mexico
5. He must not file a joint
return with his spouse or be claiming a dependent of his own
6. He must not be the qualifying
child of another taxpayer
Nontaxable Social security
doesn't count as income, for the income test, but social security money he/she
spends on her self does count as support not provided by you, for the support
test. Money he puts into savings & investment does not count as support he spent on himself. Note that a parent is closely related so there is no
requirement that he live with you at any time, during the year. But if you provided
a home it helps your support case. If no
one person (or married couple) provides 50% of the support (for example your
siblings are also sending support), then a "multiple support agreement”
(IRS Form 2120) can be used, to allow you to claim the dependent. https://www.irs.gov/pub/irs-pdf/f2120.pdf
The IRS has a worksheet that can
be used to help with the support calculation. See: http://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf The support
value of a home is the fair market rental value, divided by the number of occupants.
