Can I Claim HOH with Sibling as Dependent Who Exceeds Income Limit?

You've got most of the details right, but there's a key distinction here that might help your situation. For Head of Household (HOH) filing status, you need a "qualifying person" - which isn't always the same as a dependent. For your sister, you're correct that the gross income test is an issue for claiming her as a dependent. Since she earned more than the threshold ($4,900 for 2024), she fails the gross income test for qualifying relative. However, here's the good news - you may still qualify for HOH even if you can't claim her as a dependent! For HOH, you need to: 1) Be unmarried at the end of the year, 2) Pay more than half the cost of keeping up your home, and 3) Have a qualifying person live with you for more than half the year. Your sister could be your qualifying person for HOH purposes if you provided more than half her support, even if she can't be your dependent due to the income limit. This is one of those weird tax rule distinctions that confuses a lot of people.

Just wanted to share my experience because I was in a similar situation last year. I was confused about tax filing with my brother living with me while in grad school. I found this tool called taxr.ai (https://taxr.ai) that really helped me figure out my situation. What I liked was that I could upload the IRS publication pages that were confusing me (like the Publication 501 stuff about qualifying relatives vs. qualifying persons), and it explained exactly how they applied to my situation. It clarified that I could claim HOH even though my brother made too much to be my dependent. The tool also helped me understand what kind of documentation I needed to keep to support my HOH claim. Definitely made me feel more confident about my filing.

Just wanted to follow up about my experience with taxr.ai after seeing it recommended here. I decided to try it with my situation (supporting my cousin) and it was super helpful! I uploaded the pages from Publication 501 about the tests for qualifying relatives and qualifying persons, and it explained exactly how they applied to my specific case. The tool confirmed I could file as HOH even though my cousin made too much money to be my dependent. What I really liked was being able to ask follow-up questions about what documentation I needed to keep. Saved me from paying $200 for a tax consultation just for this one question. Definitely using it again for other tax questions I have this year.

If you're still confused about your situation, you might want to try calling the IRS directly. I know that sounds awful (it usually is), but I found a service called Claimyr (https://claimyr.com) that actually helped me get through to a human at the IRS without the typical 2-hour wait. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I had a similar HOH question last year about my sister who lived with me while attending college. I was on the phone with an actual IRS agent in about 15 minutes who confirmed I could claim HOH even though I couldn't claim her as a dependent due to the income threshold. The agent walked me through exactly what documentation I needed to keep and gave me references to the specific sections in Publication 501 that applied to my situation. It was surprisingly helpful to get that official confirmation.

I need to update my previous comment. I was extremely skeptical about Claimyr, but after continuing to struggle with getting through to the IRS about my own dependent questions, I decided to give it a try. I'm honestly shocked at how well it worked. I got connected to an IRS agent in about 20 minutes (instead of the 2+ hours I had been experiencing). The agent confirmed that I could file as Head of Household with my adult nephew living with me, even though he made too much to be my dependent. She walked me through all the requirements and told me exactly what documentation to keep. The time I saved not being on hold was honestly worth it, and I got a definitive answer straight from the IRS instead of guessing based on what I read online. My apologies for the skepticism!

Something no one has mentioned yet - make sure you're calculating "support" correctly. The IRS has a specific definition. Support includes housing, food, clothing, medical expenses, education, etc. Your sister's income doesn't automatically disqualify her from being your "qualifying person" for HOH as others have mentioned, but the income does count toward her own support. So if she made $7,800, those funds could count as her supporting herself unless she used that money for other things (like tuition or savings). You still need to have provided more than half her total support for the year for HOH status. There's a worksheet in Publication 501 to help you calculate this.

Don't forget about state taxes too! Even if you qualify for HOH federally, some states have different rules. My brother lived with me in California, and their rules about HOH status were slightly different from federal.

This is a great discussion with lots of helpful insights! I had a similar situation with my adult daughter who was in her final year of college. She made about $6,200 from a part-time job, which put her over the gross income limit for being claimed as a dependent. What really helped me was keeping detailed records throughout the year. I tracked every expense I paid for her - rent for her portion of the house, groceries, utilities, car insurance, medical expenses, even things like clothing and personal items. When I added it all up, I had provided about 75% of her total support even though she couldn't be my dependent. One thing I learned is that you should start keeping these records now if you haven't already, rather than trying to reconstruct them later. I used a simple spreadsheet with categories like housing, food, transportation, medical, etc. It made filing so much easier and gave me confidence that I had everything documented properly. The HOH status saved me a significant amount in taxes compared to filing single, so it's definitely worth getting this right!