Joint Return Test: Definition & Process
If you want to claim someone else as your dependent for tax purposes, you must pass the Internal Revenue Service (IRS)’s joint return test. This test essentially means that you can’t claim a married individual as your dependent if they file a joint return with their spouse.
Read on as we take you through the definition, show you how it works, lay out the eligibility criteria, and answer some frequently asked questions.
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KEY TAKEAWAYS
- You must utilize the joint return test to determine if a person who has lived in your home, been supported by you, and has not earned any money, is a dependent.
- Most of the time, you cannot claim someone as a dependent if they are co-filing your taxes. Usually, this is a spouse.
- One exception is if the person you’re claiming as a dependent and their spouse didn’t earn enough money to be taxed but nevertheless filed a return to receive paid for any income taxes that were withheld.
What Is a Joint Return Test?
A joint return test is an IRS-created test that you can use to evaluate whether you are eligible to claim someone else as a dependent on your taxes. The joint return test essentially states that you cannot be someone else’s dependent if you are eligible to file jointly with your spouse.
How Does a Joint Return Test Work
According to the joint return test, a dependent cannot file a joint return with a spouse and yet be claimed as a dependent on another return, such as a parent’s or a guardian’s. This rule does have an exception though, which we will discuss in the next section.
Since it is advantageous to claim dependents, the IRS has implemented a number of criteria, including the joint return test, to ensure that dependents are not being double-claimed.
What Are the Criteria for a Joint Return Test?
You are not allowed to claim a married person as your dependent if that person files a joint return. The joint return test, however, has one exception. You can claim a married person who files a joint return as your dependent if the person and their spouse file a joint tax return to obtain a refund of income tax withheld or estimated tax paid.
What Is the Significance of a Joint Return Test?
The joint return test is crucial because it establishes safeguards against taxpayers seeking arbitrary exemptions. The test is used to prevent taxpayers from claiming excessive exemptions.
It’s particularly relevant in understanding the implications of claiming someone as a dependent, especially when considering the choice between married filing jointly vs separately.
A married person may be claimed as a dependent when filing jointly only in one situation. Neither spouse is required to submit a tax return, and they file a joint tax return only to claim a refund of income taxes withheld.
What Is the Joint Return Test for Claiming Children as Dependents?
In order to be considered a taxpayer’s dependent and a qualifying child, the person must meet several criteria. One of these criteria is the joint return test. If married, the person did not file a joint return for the tax year, unless the return is only filed for a refund and no tax liability would exist for either spouse if they filed separately.
Beginning in 2018, the tax credit for each child that a taxpayer can claim as a dependent under the age of 17 increased from $1,000 to $2,000 .
The income threshold at which the credit fades out was also raised by Congress. In contrast to 2017 levels of $110,000 for married couples and $75,000 for singles, the credit now phases out at $400,000 of annual income for married couples and $200,000 for single taxpayers.
Since the child tax credit reduces tax obligation dollar for dollar rather than lowering taxable income through a deduction, it is a particularly important provision of the tax code for many filers.
Summary
The IRS developed the joint return test for people to verify if they can claim someone else as a dependent on their tax return. The joint return test essentially states that you cannot be someone else’s dependent if you’re married and file jointly.
FAQs on Joint Return Test
Starting in 2022, most families will receive the full amount of child tax credit, which is $2,000 for each child. To be claimed as a dependent, the married qualifying child did not file a joint return, unless the return was submitted only for refund of income taxes withheld and neither spouse would owe any taxes if they filed sep
If you and your spouse are married, you can decide to submit a joint return.
The Internal Revenue Code gives you the option to amend your tax return if you mistakenly declared your child as a dependent.
Couples who are not married cannot submit joint returns.
It’s almost always more beneficial to file your taxes jointly compared to filing separate tax returns.
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