Taxpayers with dependents who don't qualify for the $2,000 child tax credit may be able to claim the $500 dependent credit (also known as the Credit for Other Dependents).
The Credit for Other Dependents can be used for the following types of dependents:
● Dependent children who are between the ages of 17 and 23 and are still in school. ● Dependent qualifying relatives (ie: parents, grandparents, uncles, aunts, or other relatives) who are supported by the taxpayer. ● Non-relative dependents who live with the taxpayer.
There are a few additional requirements to claim the Credit for Other Dependents:
● The taxpayer must claim the dependent on the tax return. ● The taxpayer must provide at least half of the dependent’s support for the year. ● The dependent must have earned less than $4,300 in 2020. ● The dependent must be a U.S. citizen, national or resident alien.
The credit begins to phase out when the taxpayer's income is more than $200,000. This phaseout begins for married couples filing a joint tax return at $400,000.
