Can Parents Claim Minors on Income Taxes Even if the Minor Is Working?

The mere fact that your minor child has a job doesn’t automatically cost you the right to claim him as a dependent come tax time. The Internal Revenue Service guidelines recognize kids sometimes have their own incomes. However, those rules clearly define the conditions that must be met if you are to claim him as a dependent.

Child’s Filing Requirements

A dependent child might have to file his own tax return for the year if his income exceeds a certain amount. The amount changes periodically, but the cut-off was $5,800 in 2011. The limit was $950 for unearned income, or income received from sources other than a job, such as investment income or royalties. You can put your child’s income on your own tax return if the child got no more than passive or unearned income from dividend or interest payments.

Child’s Tax Return

If you choose to keep your child’s tax returns separate from your own, you’ll need to sign the return since minors can't execute legal documents. Sign your name and add the phrase, "Signing as the parent of a minor." While you’re looking over her return, verify that she didn’t take an exemption for herself. If she did, you lose; you can’t claim a dependent who takes a personal exemption on her own tax return. Technically, this shouldn’t happen because the IRS won't allow someone to take a personal exemption if anyone else has the right to claim her as a dependent.

Child’s Residency

Unless you have provided a home for your child for more than six months out of the year, you can't claim him as your dependent whether he works or not. Temporary absences don’t count against you on this test; if Junior spends the summer living and working at camp, you can still claim him. Absences for medical treatment and vacations don’t count, either, nor do absences for educational reasons.

Child’s Support

You can't claim a dependent unless you pay more than half of her support. The money your child earns and spends for her own transportation, food, clothing, medical care and other necessities counts as self support. However, if she doesn't spend the money she earns on those things, don't count it as support. For example, if she earned $10,000, spent $2,000 on a car,and put the rest in savings, only the $2,000 counts.