The head of household filing status is available on federal tax returns and some state returns. Most states follow the Head of Household rules established by the Internal Revenue Service, so if you qualify to claim your brother-in-law on your federal return, it’s likely you’ll be able to claim the same status on your state income tax return as well. The head of household filing status offers lower tax rates and increased standard deduction amounts, which reduce the amount of tax charged on your income. If you support your sister or brother-in-law, it’s definitely worth learning more about claiming siblings on taxes to see if you qualify to use this filing status.
Claiming Siblings on Taxes
Before you consider your eligibility to claim your brother-in-law or any siblign as a tax dependent, you’ll want to make sure you meet the basic IRS criteria for the head of household status. You can file as head of household if you are legally unmarried, or considered unmarried, on Dec. 31 of the tax year you want to claim your brother-in-law. You must also have at least one person to claim who qualifies as an IRS dependent, such as a child or other eligible relative. If you meet these requirements, you’re on the right track. However, you must meet a few more tests before you get the green light to claim your brother-in-law.
The IRS does not require that you have a dependent child to use the head of household status. You can use the status if you have a qualifying relative that either lives with you or qualifies to live out of your home and still be your dependent. Your brother-in-law meets the qualifying relative test based on his relation to you and does not have to live with you during the year if he meets other tests for the criteria of qualifying relative. Also, IRS rules for qualifying relatives state that a relationship caused by marriage does not end because of divorce or death. This means you may claim your brother-in-law in any year the tests are met even if he and his spouse divorce or his spouse passes away.
The IRS requires any qualifying relative, including a dependent sister or brother-in-law, to earn less than a set amount of gross taxable income to meet the gross income test. The maximum amount a qualifying relative can earn and meet this test changes each year but is set at the personal exemption amount. For the 2017 tax year, the personal exemption amount is $4,050. For the 2018 tax year, it has been adjusted for inflation to $4,150. This means a qualifying relative must have $4,050 or less in taxable income in 2017 or $4,150 or less in 2018 to meet the gross income test. Some types of income are not taxable, such as Social Security income that totals less than $25,000 per year.
The last IRS dependent test your brother-in-law must meet is the financial support test. To claim your brother-in-law as a dependent, you must provide more than half his financial support during the year. Look at his gross income from all sources and determine how much from those funds he used to support himself. If you paid more than that amount, you meet the support test. Types of support include payments for shelter, food, transportation, utilities and medical expenses.
Head of Household Exceptions
There are a few exceptions to the Head of Household rule. If your spouse falls into the category of nonresident alien during the tax year, the IRS will allow you to use the unmarried status to qualify as head of household. However, you cannot in this circumstance declare your spouse as a qualifying dependent and must have other qualifying persons to be eligible to claim head of household. If you treat your spouse as a resident alien on your return, you are considered by the IRS to be married.
2017 Tax Law
For those filing their tax return for the 2017 tax year, the standard deduction for head of household is $9,350, compared to $6,350 for those who file as single.
2018 Tax Law
For the 2018 tax year, the standard head of household deduction increases to $18,000. This increase, along with a possible reduced use of itemized deductions by some taxpayers, could affect income withholding. If necessary, the IRS recommends filing a new Form W-4 to adjust withholding for 2018.
- IRS: Publication 501 (2017), Exemptions, Standard Deduction, and Filing Information
- IRS: About Publication 501, Exemptions, Standard Deduction, and Filing Information
- IRS: In 2018, Some Tax Benefits Increase Slightly Due to Inflation Adjustments, Others Unchanged
- IRS: Publication 505 (2018), Tax Withholding and Estimated Tax
With a background in taxation and financial consulting, Alia Nikolakopulos has over a decade of experience resolving tax and finance issues. She is an IRS Enrolled Agent and has been a writer for these topics since 2010. Nikolakopulos is pursuing Bachelor of Science in accounting at the Metropolitan State University of Denver.