Hi,
My parents stayed in CA, USA for 178 days. Can I show them as dependent while filing taxes for year 2009?

I supported them completely while they were in US. They're india citizen & are retired.

If so, can I take the passport notary no itself so that I can show it while filing taxes along with W7?

Help.

Regards!

You CANNOT claim them as dependents, as they have NOT met the 183-day Substantial Presence Test!

Hello,
Thanks for your reply! However, I'm little confused with your answer in another thread at https://www.askmehelpdesk.com/taxes/claim-parents-dependent-tax-return-76380.html

I've one more question. If they come back again in US in next month & stayed with me for a couple of months, in that case, can I claim them as dependent?

Thanks!

Read this
http://www.irs.gov/pub/irs-pdf/p501.pdf
Starting at page 11

To be claimed as a dependent, the parent MUST be a U.S. resident. To be considered a U.S. resident, they must meet the 183-day Substantial Presence Test, which is explained in detail in IRS Pub 519.

Your parents clearly did NOT meet the SPT, which is why you cannot claim them as dependents.

But then, If the parents stay with me for first 6 months & then nov & dec month, then the total stay during the year goes beyond 183 days. In that case, can I claim them as dependent?

The time in the first year (six months) is decremented by two-thirds. In other words, of the 178 days in the first year, only 59 days counts towards the SPT in the second year. That 59 days, combined with the two months (60 days), is only 119 days, which is short of the SPT by 64 days.

Thanks AtlantaTaxExpert!

You're really expert in knowledge!

I still have some question. Can u tell me with example how to qualify for 183 days when a person can stay only 6 months in US?

How come u did the 2/3 for 178 days & not for 60 days later?

Thanks!

Okay, let me see if I have this straight:

They stayed in the U.S. for 178 days from Jan to June 2008, then another 60 days in November and December of 2008?

If so, then they HAVE met the SPT and can, In my opinion, be claimed as dependents. I have queried the IRS in the past on this matter and that IS their guidance.

You will need to submit Forms W-7 to get them ITINs, but, provided you can show their 230+ days of presence in the U.S. and provided the IRS accepts your stance that you have provided more than 50% bof their total support, you should be able to claim them as dependents.

Maybe there is some confusion here.

Suppose your parents stay with you in 2009 for 178 days staying from Jan 1 to June 27th and then go home to India.

If they came back and spent part of November and December with you, let's say 30 days that would make them resident by substantial presence and you could take them as dependents.

They would need ITINs of course.

Five Rings:

I re-read his answer, then amended my original post.

Looks like you answered amd I amended at the same time.

Great minds thinks alike! :-)

Hi AtlantaTaxExpert & all others who replied to this forum,
Thanks for all your great helpful answers!!

In order to make things more clear, I'm asking few more questions... I'll really appreciate if you can answer those as well..

1. A person XYZ's parents stayed in US in year 2009 from, say Mar 22, 2009 to Sep 15, 2009 (Total Days = 178)& went back to India.
2. Now, if XYZ's parents come back again in next year 2010 & will be staying for 124 days between anytime from Jan to Dec 2010,

Then, I believe XYZ can claim them as dependent while filing tax return (in year 2011) for year 2010, am I correct?

Thanks!

Read the rules for substantial presence:

Substantial Presence Test (http://www.irs.gov/businesses/small/international/article/0,,id=96352,00.html)

Hi,

1. As per the link, 124+ 178/3 = 124+59=183 days, so parents can be claimed as dependent,right?

2. Related question - If the spouse is not working (homemaker) & she spent 7 months out of US & she is not US citizen, then can we still show spouse as dependent? Is this 183 days rule applicable for spouse too?

3. Another related question - A new born baby who is born in US in the month of Aug (who has not completed 183 days since born in that year) can be claimed as dependent or not? Is this 183 days rule applicable for new born baby too?

Thanks!

1. yes

2. There is a better way. If you are a citizen or resident alien and your wife is a nonresident alien you can both choose to treat her as a US resident. She has an ITIN? If not you must get one.
You file as married filing jointly.

Go here and read about it on page 10
http://www.irs.gov/pub/irs-pdf/p519.pdf

3. The baby is a US citizen. Congratulations by the way.
He/she is considered present for the entire year, you take the child as a dependent, and claim the child tax credit ($1,000) too.

You understand that your parents will need ITINs for you to claim them as dependents, right?

On the Form W-7 check box (d) filling in your name and number where required. One W-7 for each of them. Submit these forms with your tax return to:
Internal Revenue Service
ITIN Operation
P.O. Box 149342
Austin, TX 78714-9342

Hello Five Rings,
Thanks for all your detailed responses!

How come a baby born in US do not need to go through 183 days test? I mean if a person's baby is born on 30 Dec, can the parents still claim $1000 credit?

Also, I'm a resident alien & my wife has an TIN as well as SSN. If she spends say, 10 months out of US & live in US only for Nov & Dec, can I still show her as dependent while filing as Married Jointly? If so, why 183 days rule is not considered in this case?

Thanks!

A child born in the U.S. is, by law, a citizen of the United States, and automatically qualifies for the $1,000 Child Tax Credit plus, if he spends ANY time in the U.S. as a dependent. There is NO requirement for him to meet the SPT.

As for your wife, you CANNOT show her as a dependent. However, you CAN file jointly with her using her SSN (the ITIN is no longer valid). To file jointly, the only requirement is that you be legally married. Her physical location is irrelevent; she could be on Mars for all the IRS cares!

Hi AtlantaTaxExpert,

Understood!

Thanks again for the reply.

Regarding my question related to showing parents as dependent, Fiverings has given the link for publication p519.pdf

You've also mentioned that if parents can meet SPT, they can be claimed as dependent. But when I went through the above PDF, it has a flow diagram on page 5 which has a question at the end "Can you show that for 2008 you have a tax home in a foreign
country and have a closer connection to that country than to the
United States?"

Can you tell me how can we prove that the answer to this is "No" (assuming parents satisfy SPT) so that we can show parents as dependent while filing returns?

Thanks!

You do NOT have to prove the answer is NO. It is assumed that, if you are in the U.S. that you do NOT have a closer connection.

Hello AtlantaTaxExpert.
Once again thanks for the reply!

But the pdf also says that "Do you have home in foreign country, etc?" Obviously, my parents are from India, so they r going to have their own house in India which essentially proves that they've closer connection to India.". Are you still saying that we need to say "No"? I'm little unclear...

Thanks!

You are confusing tax home with residence.

"Your tax home is the general area of your main place of business, employment, or post of duty, regardless of where you maintain your family home. Your tax home is the place where you are permanently or indefinitely engaged to work as an employee or self-employed individual. Having a "tax home" in a given location does not necessarily mean that the given location is your residence or domicile for tax purposes."

The closer connection test is this:
Even if you meet the substantial presence test, you can still be treated as a nonresident alien if you:

Are present in the United States for less than 183 days during the year
Maintain a tax home in a foreign country during the year (Refer to Chapter 28 of Publication 17 for a discussion of the tax home concept), and
Have a closer connection during the year to one foreign country in which you have a tax home than to the United States For determining whether you have a closer connection to a foreign country, your tax home must also be in existence for the entire current year, and must be located in the same foreign country for which you are claiming to have a closer connection

It appears from what has been written so far that your parents are retired from active business and live with you most of the year. They return to India occasionally where they maintain a dwelling to visit family and friends.

Hi FiveRings,
Once again thanks for the reply. And yes, my parents are retired & they came to US for the first time in US. All of their property is in India only. And they are planning to visit US again in next year... Hopefully, I'll be able to file their TIN & showing them dependent next to next year, since they'll pass SPT in next year... Correct me if I'm wrong... This thread has definitely answered all questions related to parents showing as dependent & will be helpful to everyone!!

Thanks!

Some good info here.

Can the experts define "current year" for tax purposes.

Here's an example:
Parent's here as below:
* 9 days in 2010 (They leave on 10th)
* 179 days in 2009
* 140 days in 2007
* 180 days in 2005

I have not yet applied for their ITIN but would like to do so if I can.

SPT rules - 31 days in "current" year and 183+ days in prior 3 years with the yearly fractional breakout of 1/3rd and 1/6th.

Clearly, they don't meet 31 days criteria in current year, that is, assuming current year = 2010 for tax purposes.

BUT, if current year = 2009 (as of 7th Jan 2010) for tax year, then the meet the 31 days plus the 183+ criteria easily.

So... how is "Current Year" defined.
1. Based on the current *tax* year?
2. Based on the a given day (when the question is asked and being responded to) in the current calender year
3. Based on the filled on date entered on the W7 form (though it will be submitted with the tax returns much later in 2010)

I hope it's #1 otherwise I will be cursing myself for the rest of the year for not applying for their ITIN in December 2009.

Thanks.

Based on their presence in the U.S. in 2009 and 2007, they HAVE the Substantial Presence Test.

Apply for their ITINs with your 2009 tax return, and claim them as dependents on the 2009 return. Note that they MUST sign the Form W-7.

Hi,

I have been claiming my son as a dependent for the last couple of years. He was here in the US for about 2 yrs (obtained a ITIN #) and then went back to my country. I support him economically but he has not returned to the US since he left in 2002.

The person that does my taxes said it is fine for me to do this since I am still supporting him even though he is not in the US because he already met the requirements to obtain a ITIN while he was here.

An ITIN does not confer residency; it is merely an identification number. Your son must be a citizen or resident of the US to be your dependent; your advisor is in error.

Failing that test, I regret to say, you may not claim him as a dependent.

Thanks for your answer.

Bu t I am more confused now. I read in previous questions that dependents that are nonticitzens and can't qualify to obtain a SS could apply for TIN for tax pruposes in order to be claimed as dependents. Why will my son need to be a resident or Citizen to be consider as dependent?

I'm sorry you are confused; the rules can be complex. Nevertheless, the rules for dependency are quite plain.

"You cannot claim a person as a dependent unless that person is a U.S. citizen, U.S. resident alien, U.S. national, or a resident of Canada or Mexico."

See for more detail:
http://www.irs.gov/pub/irs-pdf/p501.pdf

Xina, your tax "helper" is in error. Unless you wish to commit tax fraud, you may not take your nonresident son as a dependent.

Five Rings has it right. The child MUST be located within the confines of the U.S. for some period in 2009 (if he is NOT a U.S. citizen) to be claimed as a dependent.