Can I claim my parents as dependents while they live out of state?

[Yzxyy]

My parents are retired and live in a different state as mine. I provide most of their living experiences. Can I claim them as my dependents, on both my federal and state returns?

[DoninGA]

You can claim them as dependents on your federal tax return under the Qualifying Relative rules if they meet all the requirements.  Use the worksheet on this IRS website to determine your amount of support - https://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf

To be a Qualifying Relative -

1. The person cannot be your qualifying child or the qualifying child of any other taxpayer. A child is not the qualifying child of any other taxpayer if the child's parent (or any other person for whom the child is defined as a qualifying child) is not required to file an income tax return or files an income tax return only to get a refund on income tax withheld.

2. The person either (a) must be related to you or (b) must live with you all year as a member of your household. 

3. The person's gross income for the year must be less than $4,050 (social security does not count) in 2016

4. You must provide more than half of the person's total support for the year.

5. The person must be a U.S. citizen or a U.S., Canada, or Mexico resident for some part of the year.

6. The person must not file a joint return with their spouse.

[Hal_Al]

Social security doesn't count as income, for the income test, but social security money they spends on themselves does count as support not provided by you, for the support test. Money they put into savings & investment does not count as support she/he spent on herself. Note that a parent is closely related so there is no requirement that she live with you at any time, during the year. But if you provided a home it helps your support case, unless they own the home you live in. 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.
The IRS has a worksheet that can be used to help with the support calculation. See: <a rel="nofollow" target="_blank" href="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.