Small Office Home Office (SOHO) Tax Tips

2009 IRS Uniform Definition of a Child has changed

Jan 11, 2010 Tax Changes

Beginning January 1, 2009, the Internal Revenue Service has changed their Uniform Definition of a Child regulation. As of 2009, a qualifying child (QC) must be younger than the taxpayer except when the QC is totally and permanently disabled. You cannot claim a child as a QC if they file a joint return with another individual unless that tax return is a claim for refunding payroll withholdings. IRS Form 8901, Information on Qualifying Children Who Are Not Dependents, is, as of 2009, obsolete. Your child is a QC only if you can and do claim them as a tax exemption. Furthermore, rules for filing IRS Form 8332, Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent, have changed. A divorce decree or other court documents no longer serves as notification a custodial parent has released the child tax exemption to the non-custodial parent; the non-custodial parent must file IRS Form 8332 that has the signature of the custodial parent.

The 2009 Uniform Definition of Child Checklist:
• You must be older than your QC
• A child cannot be a QC if they file a tax return jointly with another individual for any reason OTHER than claiming a tax refund.
• Your child is a QC only if you can and do claim them on your return for the exemption.
• A person other than parents can claim a QC only if neither parent claims the QC and the non-parent’s AGI is higher than the highest AGI of either parent.

Tags: 2009