10 Tax Exemptions You Should Know

Dependent Exemptions
You can claim a separate tax exemption for each of your dependents, but kids aren't your only choice for dependents. monkeybusinessimages/iStock/Thinkstock

The tax code lets you claim a personal exemption, a spousal exemption, and a separate exemption for each of your dependents. Again, sounds simple enough, right? Dependents must mean your children, right? But if that's your sole definition, you're not thinking like the IRS.

The agency allows you to claim someone as your dependent if they are either your qualifying child or your qualifying relative.

A qualifying child, according to the IRS must be your "son, daughter, stepchild, foster child, brother, sister, half-brother, half-sister, stepbrother, stepsister, or a descendant of any of them." A qualifying child must be younger than 19 (or 24 if a full-time student) and younger than you and your spouse. The child must have lived with you for more than half of the tax year and you must have provided more than half of the child's financial support.

A qualifying relative, on the other hand, is someone for whom you provide financial support, but who doesn't fit the description of a qualifying child — he or she is older than you, for example. A qualifying relative doesn't necessarily have to live in your house, as long as you provide more than half of the person's financial support and they don't earn more than $3,900 per year. In a strange twist, a roommate or even a boyfriend/girlfriend can be a qualifying relative if you financially support them and they live with you. (Unlike an actual relative, the roommate or partner has to live with you to be a dependent).