Immigrant foster child residency question

[nicholenudo]

I have had a foster child who is an immigrant who will be with be 172 days this year (placed 7/13). Before that he had 2 other placements and was only with his bio dad for less than 4 months. Since he is in our care the majority of the year can we claim him on our taxes this year?

[DoninGA]

The child must have lived in your home for over one-half of the year (183 nights or more) for you to be eligible to claim then child as a dependent on your tax return under the Qualifying Child rules.

To be a Qualifying Child -

1. The child must be your son, daughter, stepchild, foster child, brother, sister, half brother, half sister, stepbrother, stepsister, or a descendant of any of them.
2. The child must be (a) under age 19 at the end of the year, (b) under age 24 at the end of the year and a full-time student or (c) any age and permanently and totally disabled.
3. The child must have lived with you for more than half of the year. Temporary absences while away at college are considered living with you.
4. The child must not have provided more than half of his or her own support for the year.
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.
6. The child must be a U.S. citizen or U.S., Canada or Mexico resident for some portion of the year.
7. The child must be younger than you unless disabled.

[nicholenudo]

So no one can claim this child even though we are 11 days shy of the full mark? 

[DoninGA]

---

@nicholenudo wrote:

So no one can claim this child even though we are 11 days shy of the full mark? 

---

Correct, not for tax year 2023.

[NCperson · Accepted solution]

@nicholenudo best to use the IRS app related to dependents.

If you provided more than 50% of the child's support, the child could be claimed, but the tax credit they would be elgible for is the 'other dependent credit' (up to $500)  The child would need to be a US citizen or a  resident alien.  For the 'Other dependent tax credit" there is no 183 day residency test in yiur household.  

No one can claim the child for the Child Tax Credit (up to $2,000),

https://www.irs.gov/help/ita/whom-may-i-claim-as-a-dependent

[nicholenudo]

Okay so how do you know if a child is a resident alien or not? The child has lived in the United States Approximately 5 years and is enrolled in schools and such.

[Opus 17]

The child can't be a "qualifying child" dependent because they didn't live with you more than half the nights of the year.  They could be a "qualifying relative" dependent (eligible for a $500 credit, not eligible for the $2000 child tax credit) if one of these tests is true:

A. You paid more than half the child's overall financial support for the year, even though they lived with you less than half the year.  This may require some knowledge, or at least a reasonable guess, of the level of support provided by the other caregivers, as well as any support provided by the government, charities, and so on.  Support includes clothing, food, medical care, travel, entertainment, and a pro-rated share of the rent, mortgage and utilities where you provided the child a home.  If you can add up the child's total support cost for the year, and show that you provided more than half, you can claim the child as a dependent.  

B. You paid more than 10% of the child's total financial support for the year, and you get a signed statement from everyone else who provided more than 10% support, agreeing that you can claim the child and they will not.

Note that if you claim the child as a dependent, the IRS is unlikely to audit you (because only about 1% of returns are audited) unless one of the other caregivers also claims the child.  In that case, the IRS will send letters to both taxpayers asking for more information to investigate the overlapping claims. 

This is described in IRS publication 501.

https://www.irs.gov/forms-pubs/about-publication-501

[Opus 17]

---

@nicholenudo wrote:

Okay so how do you know if a child is a resident alien or not? The child has lived in the United States Approximately 5 years and is enrolled in schools and such.

---

Resident alien means either: has a green card, or passes the substantial presence test.

https://www.irs.gov/individuals/international-taxpayers/substantial-presence-test