How does filing that I supported someone affect their tax return?

[jacobfarr1996]

I allowed a friend to live with my wife and I for 8 months supplying housing and food. They were unemployed for all but 1 month of this time. If it negatively Impacts their return or mine for that time, is it worth claiming them?

[xmasbaby0]

If you friend is unrelated to you then you cannot claim him unless he lived with you for the entire year.  And you mentioned eight months.   Did the friend only live with you for part of the year?

[xmasbaby0]

It does not sound like you can claim your friend.  But to answer the question about the effect of claiming him IF you could---you would be able to get the non-refundable $500 credit for other dependents which would lower your tax liability

A person who can be claimed as someone else's dependent cannot get earned income credit, child tax credit, or education credits.  And their standard deduction is affected.

The standard deduction amount for an individual who may be claimed as a dependent by another taxpayer cannot exceed the greater of $1,100 or the sum of $350 and the individual’s earned income (not to exceed the regular standard deduction amount).

IRS interview to help determine who can be claimed:

https://www.irs.gov/help/ita/who-can-i-claim-as-a-dependent

https://ttlc.intuit.com/questions/3113432-who-can-i-claim-as-my-dependent  

[Hal_Al]

Q.  How does filing that I supported someone affect their tax return?

A.  There is nowhere on the actual tax forms where you "file" that you supported someone.  

TurboTax asks the question, did you support someone, as only one step in determining whether that someone can be claimed as a dependent on your tax return. 

Q. How does someone being claimed (or qualifying to be claimed) on my return affect their tax return?

A.  The simple answer is: it doesn't.   With the tax law change, effective 2018, most people will get the same refund whether they claim themselves or not. The personal exemption has been eliminated and the standard deduction increased.

But, taxes aren't simple So, It depends on what type of income they have and what tax benefits they otherwise qualify for.  Examples: A dependent cannot claim a dependent of their own (and the child tax credit for that dependent). A dependent cannot claim the Earned Income Credit or an education credit. A dependent with unearned income (e.g. unemployment) does not get the full standard deduction. 

The only way to be sure is to prepare returns both ways and compare.  But, that's an academic exercise.  It's not optional. If a person can be claimed as a dependent, they must check that box on their form 1040.