Does your teenager qualify for US tax benefits after age 17?
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Table of Contents
Does my teenager qualify for US tax benefits after the age of 17?
If your child is 17 or older, you may still be able to claim them as a dependent on your tax return. However, the tax benefits available change as they get older. It’s important to understand who qualifies as a dependent, what tax credits are available, and how to claim them.
How does age affect Child Tax Credit eligibility?
The Child Tax Credit (CTC) is designed to provide financial relief to families with qualifying children. However, age is an important factor in determining eligibility.
To qualify for the CTC, a child must be under 17 years old at the end of the tax year. This means if your child turns 17 during 2024, they are not eligible for the CTC for that year.
Can I still claim my teenager as a dependent for tax benefits?
Even after your child turns 17, you can still claim them as a dependent if they meet IRS requirements. While the Child Tax Credit is no longer available, other tax benefits, such as the Credit for Other Dependents and education credits, may still apply.
If you’re unsure about your eligibility, consulting a tax professional can help clarify your situation.
Who qualifies as a dependent?
The IRS defines a dependent as someone who relies on you for financial support and meets certain criteria. There are two main types of dependents:
- Qualifying Child – Typically applies to children under 19 (or under 24 if a full-time student).
- Qualifying Relative – Includes older children, parents, and other relatives who depend on you financially but do not meet the “qualifying child” rules.
Rules for Claiming a Teenager as a Dependent
- Age Requirement:
- Under 19 at the end of the tax year.
- Under 24 if a full-time student for at least five months of the year.
- No age limit if they are permanently disabled.
- Residency Requirement
- Must live with you for more than half the year. College students living away for school are still considered to meet this requirement.
- Financial Support Requirement
- Your child must not provide more than 50% of their own financial support.
- If they work, their income does not matter as long as you provide more than half of their living expenses.
- Filing Status Requirement
- If they file a joint tax return with a spouse, they cannot be claimed as a dependent unless they only file to claim a tax refund.
- Credit for Other Dependents (ODC): When living abroad, if your dependent doesn’t qualify for the Child Tax Credit, you may still claim the Credit for Other Dependents (ODC).
- Dependents 17 or older, including children in college.
- Parents or other relatives you financially support.
- Reduces your tax bill by up to US$500 per qualifying dependent.
- This credit is non-refundable, meaning it lowers taxes owed but won’t result in a refund if your tax liability is zero.
- You must have US taxable income to benefit from this credit. If your entire income is excluded under the Foreign Earned Income Exclusion (FEIE), you may not be able to use this credit.
For the Credit for Other Dependents (ODC), the dependent can have an SSN, an Individual Taxpayer Identification Number (ITIN), or an Adoption Taxpayer Identification Number (ATIN), as long as the identification number was issued on or before the due date of your tax return (including extensions).
- Education Tax Credits: If your dependent is in college, you may qualify for education-related tax benefits. Also, Both the taxpayer and the student must have a valid Taxpayer Identification Number (TIN), which can be a Social Security Number (SSN) or an Individual Taxpayer Identification Number (ITIN).
- American Opportunity Tax Credit (AOTC)
- For undergraduate students in their first four years of college.
- Worth up to US$2,500 per student for tuition, fees, and course materials.
- Partially refundable; if your tax bill is low, you may get up to US$1,000 back as a refund.
- Lifetime Learning Credit (LLC)
- Covers college tuition, job training courses, or professional education.
- Worth up to US$2,000 per tax return (not per student).
- Not refundable, but it can reduce your tax bill.
- American Opportunity Tax Credit (AOTC)
- Foreign Earned Income Exclusion (FEIE):
If you work while living abroad, you may be able to exclude up to US$126,500 of your foreign-earned income from US taxes in 2024.
However, if you exclude all of your income using FEIE, you may not be able to claim certain tax credits for your dependent.
This doesn’t directly apply to dependents, but it can help lower your overall tax bill if you’re supporting a family while working overseas.
- Foreign Housing Exclusion: If you pay for housing abroad, you may be able to exclude some of those costs from your taxable income.
- Covers expenses like rent, utilities, and other housing costs.
- Child and Dependent Care Credit: If you pay for childcare while working, you may qualify for a tax credit on childcare expenses.
- Covers up to US$3,000 in childcare expenses for one child or US$6,000 for two or more children under 13.
- Can include daycare, babysitters, and after-school programs.
- Foreign childcare providers must be identified, which can be challenging for tax documentation.
- You must have US-taxable earned income to claim this credit.
- Medical Expense Deduction (For Dependents Abroad)
- If you pay medical expenses for your dependent, you may be able to deduct expenses that exceed 7.5% of your adjusted gross income (AGI).
- Includes doctor visits, hospital stays, prescriptions, and medical procedures.
- Foreign medical expenses qualify as long as they meet IRS definitions.
- You must itemize deductions to claim this benefit.
If you’re unsure about your eligibility for these benefits, consulting a tax professional who specializes in expat taxes can help you maximize your tax savings.
Curious about other tax deductions or credits you can claim? Talk to a tax pro today.
Who can claim a dependent?
- If two parents want to claim the same dependent, the parent the child lives with most of the year usually has the right to claim them.
- If both parents split time equally, the one with the higher adjusted gross income (AGI) usually gets to claim the dependent.
- A court agreement may override these rules if it assigns dependency rights to one parent.
If someone other than a parent, such as a grandparent or sibling, supports the child, they may be able to claim them using a multiple support agreement if all qualifying supporters agree.
How do I claim a dependent on my taxes?
To claim your teenager as a dependent:
- Form 1040: List them as a dependent on your US Individual Income Tax Return.
- Information Needed: Enter their Social Security Number (SSN) and confirm their relationship with you.
- Claim Applicable Credits: Such as the Credit for Other Dependents or education credits.
- Avoid Duplicate Claims: Ensure they don’t file their own tax return as independent, which could cause an IRS issue.
What happens if my dependent files a joint return?
A dependent cannot file a joint return unless it is only to claim a refund for withheld taxes.
Can I claim my teenager if they have a job?
Yes, you can still claim your working teenager as a dependent as long as they don’t provide more than half of their own financial support.
If they earn less than the standard deduction amount (US$14,600 in 2024), they don’t have to file a tax return unless they had taxes withheld and want a refund.
When is a teenager required to file taxes?
If your teenager has a job or earns money from investments, they might need to file a tax return. The IRS has income limits that determine when a minor must file taxes.
A teenager must file a tax return if they meet any of the following conditions in 2024:
- If they make more than US14,600 in 2024 from earned income, money from a job, gig work, or self-employment, they must file.
- If they earn more than US1,300 from unearned income, money from investments, dividends, interest, or gifts, they must file.
- If their total income is more than US$1,300 OR their earned income + US$400, they must file.
- If they make US$400 or more from freelancing, babysitting, or gig work, they must file a tax return.
- If an employer didn’t withhold the taxes from Social Security or Medicare, they may need to file and pay them separately.
What types of income affect a teen’s tax obligations?
Not all income is taxed the same way. Teens need to understand the difference between earned and unearned income.
- Earned Income (Job Income)
- Wages from a job (W-2 income).
- Self-employment earnings (freelance work, gig jobs, babysitting).
- Tips, bonuses, and commissions.
- Taxes are withheld from paychecks, but teens may qualify for a refund.
- Unearned Income (Investment & Other Non-Work Income)
- Interest from savings accounts.
- Dividends from stocks or investments.
- Rental income (if they own property).
- If a teen earns over US$1,300 in unearned income, they must file a return.
- The Kiddie Tax
- If a teen earns over US$2,600 in unearned income, it may be taxed at their parent’s tax rate.
- This prevents parents from shifting investment income to their child to pay lower taxes.
How can a teenager file their taxes?
Step 1: Gather Required Documents
To file taxes, a teen may need:
- W-2 Form (for job income).
- 1099 Form (for freelance or investment income).
- Bank statements (if they have interest earnings).
- Any records of self-employment income.
Step 2: Choose a Filing Method
- Free IRS e-file – If their income is low, they may qualify for IRS Free File.
- Paper filing – They can file Form 1040 if they prefer to mail in a return.
- Parents can include them – If a teen only has unearned income, parents may be able to report it on their tax return instead.
Step 3: File by the Deadline
- Most tax returns are due by April 15 each year.
- If they are owed a refund, filing early helps them get their money faster.
Can I claim an elderly parent or a domestic partner as a dependent?
If you provide financial support for a parent or domestic partner, you may be able to claim them as a dependent under the qualifying relative rules.
- The dependent must earn less than US$5,050 in 2024.
- You must provide more than half of their financial support.
- If multiple family members contribute to an elderly parent’s care, they can use a multiple support agreement to determine who can claim the parent.
If your child is 17 or older, you can still claim them as a dependent if they meet the IRS requirements. While you lose the Child Tax Credit, other tax benefits, like the Credit for Other Dependents (US$500), education credits, and medical expense deductions, may still apply.
If you support a parent or domestic partner, they may qualify as a dependent relative if they earn less than US$5,050 in 2024 and rely on you for financial support.
