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IRS Releases Top 10 Tax Facts for Exemptions and Dependents

The IRS released another top 10 list, this time identifying the important information for exemptions and dependents. These tips aim to help taxpayers reduce the amount of tax they owe.

Without further ado, the IRS Top 10 Tax Facts for Exemptions and Dependents:

  1. E-file software can identify exemptions you can claim.
  2. Exemptions, whether personal or for a dependent, usually let you deduct $4,000 for each one you claim.
  3. When filing a separate return from your spouse, you can only claim an exemption for your spouse if your spouse had no gross income, is not filing a tax return, and wasn't the dependent of another taxpayer.
  4. You can usually claim an exemption for each of your dependents.
  5. The individual shared responsibility provision requires you and each member of your family to either have qualifying health insurance, called minimum essential coverage; or have an exemption from this coverage requirement; or make a shared responsibility payment when you file your 2015 tax return. Visit IRS.gov/ACA for more on these rules.
  6. You normally may not claim married persons as dependents if they file a joint return with their spouse. There are some exceptions to this rule.
  7. A person who you can claim as your dependent may have to file their own tax return. This depends on certain factors, like total income, whether they are married, and if they owe certain taxes.
  8. If you can claim a person as a dependent, that person can’t claim a personal exemption on his or her own tax return. This is true even if you don’t actually claim that person on your tax return. This rule applies because you can claim that person as your dependent.
  9. The $4,000 per exemption is subject to income limits. This rule may reduce or eliminate the amount you can claim based on the amount of your income.
  10. Use the Interactive Tax Assistant tool on IRS.gov to see if a person qualifies as your dependent.

Source: Internal Revenue Service

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