Claiming dependents on your tax return can make a big difference in what you pay in taxes (or how big a refund you get). Each child you can claim as a dependent on your 2014 tax return knocks $3,950 off your taxable income, saving $988 in the 25 percent bracket. But children aren't the only ones you can claim as dependents.
Despite attempts by the IRS to clarify whether or not someone qualifies as a dependent, today's complex living arrangements often raise questions as to just whom can be claimed on your tax return. There are now two classes of people who can qualify as dependents:
- Qualifying children
- Qualifying relatives
See how the IRS defines dependents here. The following Q&As can also help clear up the confusion about who can and cannot be claimed as a dependent.