Credit for Other Dependents

Updated on: Oct 10, 2018

The new tax law created a new nonrefundable credit in the amount of $500 for each qualifying dependent who isn’t a qualifying child for whom the refundable credit is allowed.

Previous (2017)

N/A

Change

For tax years beginning after December 31, 2017, and before January 1, 2026, there is a new nonrefundable $500 credit for each qualifying dependent who isn’t a qualifying child for whom the refundable credit is allowed (qualifying relatives and qualifying children who don’t meet the new requirement for a Social Security number valid for employment, which is applicable to the refundable credit). The dependent must be a citizen, national, or resident of the United States.

 

The amount of the credit isn’t annually adjusted for inflation. This credit begins to phase out for taxpayers with adjusted gross income more than $400,000 (in the case of married taxpayers filing a joint tax return) and more than $200,000 (for all other taxpayers).

How will this affect me?

Scenario 1

During 2018, Lisa lived with her mother, a U.S. citizen, for the entire year in Lisa’s home. Because her mother’s only source of income is Social Security benefits, Lisa provides well over 50 percent of her mother’s support. Lisa’s mother qualifies as her dependent, and Lisa can claim the full $500 nonrefundable credit for her mother if her income is no more than $200,000.

Scenario 2

Same as above, but Lisa’s mother doesn’t qualify as her dependent, because Lisa provides less than half of her mother’s support. Lisa can’t claim the $500 credit for her mother.