Sunday, January 3, 2010

Answers to the easy questions

The answers to these questions are unambiguous!

If person A can be claimed as a dependent on taxpayer B's return, then person A is not entitled to claim ANY exemptions on his own return. The total number of exemptions on person A's return is ZERO!

Person A can't claim a personal exemption for himself, nor can s/he claim any deductions for dependents.

The rule is: dependents may not have dependents! And dependents may not claim themselves either.

And note that it does NOT matter whether person B actually claims person A on his tax return. Even if person B does not claim person A, the fact that person B could claim person A precludes person A from claiming any exemptions whatsoever!

This may sound very abstract, but every year we see taxpayers who ask "Is it better if I claim my child or should I let my child claim himself?"

The answer is: you don't get a choice to "let" your child claim himself.

It's 2010. The facts are the facts, as far as 2009 is concerned. If your child meets the criteria to be your dependent, then you have the choice as to whether to claim him or not, but, even if you do not claim him, he does not have the option to claim himself. And, moreover, even if you don't claim a dependent, that dependent does not have the option to claim dependents of her own.

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