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 Dear
Tax Talk,
I am a U.S. resident (on H1 status). I will be filing taxes for me and my dependents living with me.
But parents in native country are supported by me. If they
come on visit visa, can I add them to my list
of dependents while filing taxes? What are the
restrictions? If that is possible, how long I
can claim them as my dependents, though they are
not with me for the whole year? A couple of friends
filed taxes like this and they got even refunded,
and ITIN numbers for their parents. How is this
possible?
I appreciate your valuable comments on this. Thanks.
-- Pani
 Dear
Pani,
Two friends don't make it right. In order to claim
individuals as your dependents, they have to be
U.S. residents for income tax purposes or residents
of Canada or Mexico. If your parents are not from
Canada or Mexico, they'll have to be considered
U.S. residents for income tax purposes during
the current tax year (2007) in order to claim
them as dependents.
To be a U.S. resident they have
to be in the U.S. for a period that exceeds either:
a. 182 days in the current year.
b. More than 182 days counting 100 percent of
the days in 2007 plus one-third of the days
in the United States in 2006 and one-sixth of
the days in the United States in 2005. They
have to be in the United States for at least
31 days in 2007 to qualify under this test.
Assuming they enter on a tourist visa, the maximum permissible stay is usually six months, which will get you close to the 183 days you need for their eligibility as a resident or they'll have to make two trips during the year. Whether Canadian, Mexican or a U.S. resident under the days-present test, you need to provide more than half of their support in order to claim them as dependents. Their gross income also has to be less than the exemption amount (which in 2006 was $3,300; it changes from year to year). You can continue to claim them as dependents so long as they maintain their residency status.
If you can claim your parents under
the preceding tests, they should apply for an
ITIN (individual taxpayer identification number)
on Form
W-7. Submit Form W-7 with the required
documentation (notarized copy of passport) when
you file the return for the year that you claim
your parents as dependents. Note that you have
to file that return with the IRS Center stated
in the W-7 instructions (currently Ogden, Utah)
and not where the 1040 instructions state.
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