Can my brother claim my daughter as a dependent?

[sonjakay7588]

My daughter and I lived with my grandmother and the only source of income I had for most of the year was $411 in food stamps each month. I got $100 a month in child support but that of course is not enough to make ends meet- so my brother helped me out even though he wasn't living with us as he had a well paying job and pretty much provided her with everything she needed, basically supporting her financially until I was able to get a job in November. So my question is, can he claim my daughter/his niece?

[BobinCT · Accepted solution]

If you had less than $4050 of income (food stamps don't count) then he can claim your daughter and you.

[maglib]

you would all 3 possibly meet qualifying relative rules and even your grandmother may.  Issue is he had to provide more than half your support so I'm not sure if he meets this rule or your grandmother does as the cost of the home is a big portion of the support test. see p. 16 for support test calculation  <a rel="nofollow" target="_blank" href="https://www.irs.gov/pub/irs-pdf/p501.pdf">https://www.irs.gov/pub/irs-pdf/p501.pdf</a>  your grandmother may be the one who can claim you both....

[BobinCT]

excellent point.

[sonjakay7588]

She just provided the home. I provided mine and my daughters food with the food stamps. I'd take her to school, bring her home cook dinner then we'd visit my brother for hours and I'd only come home to give her a bath and put her to bed (and go to myself) he bought all of her clothes, school supplies and everything else she needed. The money he spent on her and loaned/gave to me far outweighs the amount that my grandmother or I put into supporting her.

[maglib]

you need to go through the support test, it's not us you need to convince.  We do not know your personal information as this is a public forum.  The rules are not simple.  A loan does not qualify as support either as you must pay that back.  Where she lived, is where her bed was so that is the home.

[sonjakay7588]

And we called it a "loan" though it was more of a gift, I can be very stubborn about reaching out for help. He does not want me to repay him. Not trying to 'convince' anyone, just seeking some advice. I'm not familiar with the cans and can'ts when it comes to tax returns. I've only filed single and then I became a stay-at-home mom when I was with my ex (most of the reason I went through a rough patch, I wasn't working therefore I didn't have a nest egg or any recent work experience). He used to claim my daughter and I.

[Hal_Al]

If you call it a loan, it is not support and he can NOT claim her.

[Hal_Al]

Simple answer: No.

The reasons are not so simple.

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 residence test. Only a QC qualifies a taxpayer for the Earned Income Credit (EIC) and the Child Tax Credit (CTC). They are interrelated but the rules are different for each.

Because you brother and his niece do not live in the same household; she cannot be his QC. She might still qualify as his qualifying relative, if he provided more than half her support*. But, he could only claim her exemption for a $4050 deduction. He could not claim her for the EIC or CTC.

Your daughter can be your QC or she can be your grandmother’s QC. Either of you will, most likely, get a bigger refund than your brother.

*From what you describe, it is unlikely your brother meets the support test, since your grandmother is furnishing housing. If no one person provides 50% of the support (in your case, 3 people are providing some support), then a "multiple support agreement” (IRS Form 2120) can be used, to allow one 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.

[Hal_Al]

Like I said, it's complicated. Support is only one of the rules for claiming a Qualifying Relative dependent*. An additional rule is that the child cannot be the qualifying child of another taxpayer. If either you or your grandmother have enough income that you are required to file a tax return, your brother cannot claim his niece, because she is QC of another taxpayer.

*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 $4,050 (2016-17)
3. The taxpayer must have provided more than 1/2 his support
In either case:
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

[sonjakay7588]

My grandmother only collected social security, and I only started working part-time in November (I'm working way more this year and I'll definitely be claiming her next year as I don't require my brothers assistance and have my own place now. Was going through a rough patch last year.) but my total income (not counting food stamps) was less than $1,000.

[Hal_Al]

If you are convinced (I'm not convinced) that he provided more than half her support, then yes he can claim her as a qualifying relative (no EIC or CTC or Head of Household status).
If questioned by the IRS, he will have to produce the support work sheet previously mentioned or he may want to file form 2120 with his return.

[Santrice]

Hi so I let my brother claim my daughter on his taxes for last year is there anything I need to show to irs that I’m letting him claim my daughter if so what is it please. Also her dad were claiming her but he had got audit so he can’t claim her anymore is there anything I can do that my brother can use for my daughter.

[KrisD15]

If your daughter is a dependent of your brother, there is nothing you need to send to the IRS, but the requirements must be met. It isn't something you just "give" someone. 

For your brother to claim your daughter, your daughter must be considered what the IRS calls "Qualifying Child" or "Qualifying Relative". 

Qualifying child

To qualify as a dependent, a child must also pass these tests:

• Relationship: Be your son, daughter, stepchild, eligible foster child, brother, sister, half-sister or -brother, stepbrother, stepsister, adopted child or the child of one of these
• Age: Be under age 19 or under 24 if a full-time student, or any age if permanently and totally disabled
• Residency: Live with you for more than half the year, with some exceptions
• Support: Get more than half their financial support from you
• Joint return: Not file as married filing jointly unless only to claim a refund of taxes paid or withheld

See the full rules for a qualifying child

Qualifying relative

A qualifying relative must meet general rules for dependents and pass these tests:

• Not a qualifying child: Isn't your qualifying child or the qualifying child of any other taxpayer
• Member of household or relationship: Lives with you all year as a member of your household or is a specific type of relative
• Gross income: Has gross income under $5,050
• Support: Gets more than half their financial support from you

See the full rules for a qualifying relative”

IRS LINK