Wagner Header

The Wagner Law Group

The Wagner Law Group is a nationally recognized practice in the areas of ERISA and employee benefits, estate planning, employment, labor and human resources, investment management and real estate. 


Established in 1996, The Wagner Law Group has 28 attorneys engaged exclusively in employee benefits, estate planning and employment law. Six of our attorneys are AV rated by Martindale-Hubbell as having very high to preeminent legal abilities and ethical standards. The firm is among the largest ERISA boutiques in the country. Our practice is national in scope, with clients in more than 40 states and several foreign countries.





Contact Info

The Wagner Law Group


  Integrity | Excellence



Tel: (617) 357-5200 

Fax: (617) 357-5250 

99 Summer Street 

13th Floor

Boston, MA 02110


Washington, D.C.

Tel: (202) 969-2800

  Fax: (202) 969-2568

800 Connecticut Ave., N.W.

Suite 810

Washington, D.C. 20006


Palm Beach Gardens 

Tel: (561) 293-3590
Fax: (561) 293-3591
7108 Fairway Drive
Suite 125
Palm Beach Gardens, FL 33418



Tel: (813) 603-2959

Fax: (813) 603-2961

101 East Kennedy Boulevard

Suite 2140
Tampa, FL  33602 


San Francisco

Tel: (415) 625-0002

Fax: (415) 358-8300

300 Montgomery Street

Suite 600

San Francisco, CA 94104


St. Louis

Tel: (314) 236-0065

Fax: (314) 236-5743
100 South 4th Street, Suite 550
St. Louis, MO  63102 







February 10, 2017


 Health and Welfare Law Alert




 IRS Issues Proposed Regulations Redefining Dependent for Federal Tax Purposes




The Internal Revenue Service has issued proposed regulations that redefine the term "dependent" under the Internal Revenue Code.  In particular, the proposed regulations implement the changes made to the Code (including the definition of dependent) by the Working Families Tax Relief Act of 2004 ("WFTRA") and related legislation. 



Background.  The Code generally allows an individual taxpayer claim an exemption for dependents who have satisfied the requirements of Code Section 152. 



WFTRA amended Code Section 152 so that a taxpayer may only claim a "qualifying child" or a "qualifying relative" as a dependent for federal tax purposes. 



Code Section 152(c) defines a qualifying child as an individual who:


  • Has a certain relationship to the taxpayer (i.e., the qualifying child relationship test).
  • Has the same principle place of residence as the taxpayer for over half of the tax year (i.e., the residency test).
  • Is younger than the taxpayer and under age 19 (i.e., the age test).
  • Does not provide more than half of their own support (i.e., the support test).
  • Does not file a joint return with a spouse except to claim a refund of estimated or withheld taxes.


Code Section 152(d) defines a qualifying relative as an individual who:


  • Has a specified relationship with the taxpayer.
  • Has gross income of less than the federal exemption amount for the tax year.
  • Receives over half of their support from the taxpayer.
  • Is not another taxpayer's qualifying child.


In the context of employee benefit plans, the federal definition of dependent determines whether an individual (e.g., domestic partners, children over age 27) can receive employer-provided health insurance on a tax-free basis, and whether certain expenses related to child care are eligible for reimbursement from a dependent care flexible spending account.




IRS Regulations.  Highlights from the proposed regulations include:


  • Changes to the method for determining a taxpayer's adjusted gross income under the "tiebreaker" rules when a child can be claimed by more than one taxpayer and the source of support of certain payments that originated as governmental payments.
  • Guidance on the application the Code's relationship, residency, age, support, and joint return tests for determining whether an individual is a taxpayer's qualifying child.
  • Clarification regarding dependent status determinations for students, children placed for adoption and foster children.


The proposed regulations are available at:  https://www.gpo.gov/fdsys/pkg/FR-2017-01-19/pdf/2017-01056.pdf




This Newsletter is protected by copyright. Material appearing herein may be reproduced with appropriate credit.


This Newsletter is provided for information purposes by The Wagner Law Group to clients and others who may be interested in the subject matter, and may not be relied upon as specific legal advice.  This material is not to be construed as legal advice or legal opinions on specific facts. Under the Rules of the Supreme Judicial Court of Massachusetts, this material may be considered advertising.