Lesson Summary

Dependency exemptions reduce taxable income by the exemption amount.

• For 2014, the exemption amount is $3,950

A taxpayer cannot claim a dependency exemption for a person who can be claimed as a dependent on another return.

To claim a dependency exemption, all of the dependency tests must be met for either a "qualifying child" or a "qualifying relative."

A qualifying child: must be younger than you (or your spouse if filing jointly); cannot file a joint return unless filed only as a claim for refund; cannot be claimed as a qualifying child on another person's form unless special requirements are met; can and is claimed as an exemption on your tax form.

The term "dependent" means a "qualifying child" or a "qualifying relative."

A. To claim a dependency exemption for a qualifying child, all of the qualifying child dependency tests must be met:

Dependent Taxpayer Test Joint Return Test Citizen or Resident Test Relationship Test

Age Test Residency Test Support Test

B. To claim a dependency exemption for a qualifying relative, the person must meet the following tests:

Dependent Taxpayer Test Joint Return Test Citizen or Resident Test Not a Qualifying Child Test

Member of Household or Relationship Test Gross Income Test Support Test