Can I claim someone who received unemployment benefits?

[Marketstar]

You may be able to claim an individual as a Qualifying Relative dependent if:

• You provided more than half of his upport in 2016
• He earned less than $4,050 in gross taxable income. (Social Security income generally doesn’t count here.)
•  He lives with you 365 days in the year or is related to you.
•  He isn’t a dependent on someone else’s tax return.
• He isn’t filing a tax return with a spouse (married filing jointly).
• He  is a U.S. citizen, resident alien, national, or a Canadian or Mexican resident

You can’t claim a dependent if you are a dependent on someone else’s taxes

See Rules For Claiming Dependents

Note: Unemployment benefits are taxable income

[justevelin]

Hi. I have an 18 year old son who is my dependent.  I am a single mother.  My son worked for three weeks last year and the pandemic hit so he received unemployment.  I am the sole provider for our household.  My income covers all or expenses and he lives with me full time.   He attends college online due to covid.  Can I still claim his as a dependent even if he received unemployment?

[Hal_Al]

Q. Can I still claim his as a dependent even if he received unemployment?

A. Yes, most likely.

A child of a taxpayer can still be a “Qualifying Child” (QC) dependent, regardless of his/her income, if:

1. He is under age 19, or under 24 if a full time student for at least 5 months of the year, or is totally & permanently disabled
2. He did not provide more than 1/2 his own support. Scholarships are considered third party support and not as support provided by the student.
3. He lived with the parent (including temporary absences such as away at school) for more than half the year

So, it doesn't matter how much he earned. What matters is how much he spent on support. Money he put into savings does not count as support he spent on him self.

The support value of the home, provided by the parent, is the fair market rental value of the home plus utilities & other expenses divided by the number of occupants.

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

[JayDeeChapman]

My son is single, 27 years old, a US citizen, not in college, lives with me full time all year at my home in Colorado of which I cover all living expenses, and he cannot be claimed on anyone else's return.

He received more than $4, 200 in unemployment benefits in 2020, and did not have a regular job all of 2020. Can I still claim him as a dependent, and will doing so affect his ability to receive unemployment benefits later if necessary?

[xmasbaby0]

The income amount that would prevent you from claiming him is $4300----if his income--including unemployment was more than $4300 in 2020 you cannot claim him.

When you claim an adult all you "get" is a $500 credit for other dependents.   Better look carefully at his income amount and at the support test.   If he is claimed as a dependent he does not qualify to get stimulus checks.

CREDIT FOR OTHER DEPENDENTS

https://ttlc.intuit.com/questions/4499708-what-is-the-500-credit-for-other-dependents-family-tax-cre...

https://ttlc.intuit.com/community/children-dependents/help/what-does-financially-support-another-per...

[Hal_Al]

Yes, unemployment compensation is "income"  for purposes of the $4300 (2020 limit) dependent income test.

The definitive, non-vague answer is:  You cannot claim him.

 Unemployment is not considered "earned income" but it is taxable, reportable and gross income,   as relates to claiming him.  The income test is not an earned income test, it is a "gross income" test.

[Lupe610]

Can my daughter be claim on my taxes full time student receives financial aid n unemployment lives with me n will that effect her income tax 

[DawnC]

You can claim her as a dependent if she is under 24 and does not provide over half of her own support, which she probably does not.   If you can claim her, you claim any education credits available and she indicates that she can be claimed on another return.  The taxes she pays on the unemployment income will be the same either way.   

You can claim your daughter as a Qualifying child, if:

• They're related to you.
• They aren't claimed as a dependent by someone else.
• They're a U.S. citizen, resident alien, national, or a Canadian or Mexican resident.
• They aren’t filing a joint return with their spouse.
• They're under the age of 19 (or 24 for full-time students).
• They lived with you for more than half the year (exceptions apply).  Time spent at college is time considered living with you.
• They didn't provide more than half of their own support for the year.  Here is a worksheet to help determine this requirement.  

Support includes:
- Food
- Lodging (even if your mortgage is paid off)
- Clothing
- Education (including the GI bill)
- Medical and dental care (including insurance and supplementary Medicare premiums)
- Recreation
- Transportation and similar necessities

Support does not include:
- Life insurance premiums
- Funeral expenses
- Federal, state, or local income taxes or Social Security and Medicare taxes paid on a person's own income
- Scholarship grants
- Income made by a disabled person in a sheltered workshop

Generally, if this person provides more than half of his or her own support, you cannot claim him or her as a dependent.   @Lupe610

[Cloveless]

This had me stressed out also as my daughter got unemployment this year and was a student. I did file her own taxes as a dependent and she paid her tax on her unmployment, I didnt claim the education credit though i got confused when it asked if I had claimed it 4 times in my life, yes I HAVE as MYSELF as a student, but she has never claimed it. So i didnt get the credit and when i filed her taxes she was unable to get it because I claimed her. I am worried about 2021 as the same sensario she was a student and on indemployment, but you say I can claim her as long as I file her seperstely as a claimed dependent correct?

[Critter-3]

Each student can claim the AOC 4 times so when it asked if the AOC had been taken for the person listed in the credit section it was not referring to you ... so to get the credit you missed amend the return.  

To see how to amend your taxes, click here: 

Steps to amend in TurboTax

How to file amendment

[uabbasi94]

I want to claim my brother as a dependent. He has mental disability and i helped pay for everything for him. But he also collected unemployment during the 2021 year that added to $20k. Can i still claim him as a dependent?

[Hal_Al]

Probably not.  If he's collecting unemployment that probably means he's capable of holding a job and he would not qualify as disabled.  But. it's complicated. Read on for details.

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, student status, a relationship test and residence test. Only a QC qualifies a taxpayer for the Earned Income Credit and the Child Tax Credit. They are interrelated but the rules are different for each.

The support test is different for each type. The support test, for a QC, is only that the child didn't provide more than half his own support. The support test for a Qualifying Relative is that the taxpayer provided more than half the relative's support.  The income limit for a Qualifying Relative is a mere $4300, including unemployment

.A child closely related to a taxpayer can be a “Qualifying Child (QC)” dependent, regardless of the child's income, if:

1. He is under age 19, or under 24 if a full time student for at least 5 months of the year, or  is totally & permanently disabled
2. He did not provide more than 1/2 his own support
3. He lived with the relative (including temporary absences) for more than half the year
4. He is younger than the relative (not applicable for a disabled child)
5. If the child meets the rules to be a qualifying child of more than one person, you must be the person entitled to claim the child as a qualifying child (this essentially means that you have the parent’s permission to claim the child, if the child also lived with the parent more than half the year)
6. If the parents of a child can claim the child as a qualifying child but no parent so claims the child, no one else can claim the child as a qualifying child unless that person's adjusted gross income (AGI) is higher than the highest AGI of any of the child's parents who can claim the child.

See full dependent rules at: https://turbotax.intuit.com/tax-tools/tax-tips/Family/Rules-for-Claiming-a-Dependent-on-Your-Tax-Ret...

No specific medical diagnosis constitutes disabled to tax purposes.

“The term ‘disability’ means, with respect to an individual –

            (a)        a physical or mental impairment that substantially limits one or more of the major life activities of such individual;

            (b)        a record of such impairment; or

            (c)        being regarded as having such an impairment.”

For the IRS, disabled means -

"an individual shall be considered to be disabled if he is unable to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or to be of long-continued and indefinite duration. An individual shall not be considered to be disabled unless he furnishes proof of the existence thereof in such form and manner as the Secretary may require. "

I believe the substance of that paragraph is that it is your Doctor's decision

1. He or she cannot engage in any substantial gainful activity because of a physical or mental condition and
2. A doctor determines the condition has lasted or can be expected to last continuously for at least a year or can lead to death.

However, the IRS defines Substantial gainful activity this way so if they have part time jobs then they are engaging in any substantial gainful activity so it would not meet the requirements.

"Substantial gainful activity is the performance of significant duties over a reasonable period of time while working for pay or profit, or in work generally done for pay or profit. Full-time work (or part-time work done at your employer's convenience) in a competitive work situation for at least the minimum wage conclusively shows that you are able to engage in substantial gainful activity. "