(1) Except as provided in (2), a taxpayer is allowed a dependent exemption for each dependent who receives over half of his or her total support from the taxpayer. This support test must be implemented like the support test in 152(d)(1)(C) of the Internal Revenue Code (IRC), and all related U.S. Treasury Department regulations about qualifying relatives.
(2) A dependent exemption is not allowed for an individual described in (1):
(a) who, during the calendar year, has gross income of more than the exemption amount allowed under 15-30-2114, MCA; unless the individual is the taxpayer's "qualifying child," as defined in section 152 of the IRC, and meets the support test for "qualifying child" under 152(c)(1)(D), of the IRC;
(b) who makes a joint return with their spouse for the same tax year or for a tax year that begins in the calendar year in which the tax year of the taxpayer begins; or
(c) for whom an exemption for a dependent child with a disability is claimed as provided in (3).
(3) In lieu of the dependent exemption described in (1), a taxpayer is allowed an exemption equal in amount to twice the dependent exemption for a qualifying dependent child with disability.
(a) A child, meaning an individual whose relationship to the taxpayer conforms with the requirements in 152(C)(2) of the IRC, qualifies as a dependent child with disability for the purpose of applying 15-30-214, MCA, if:
(i) the child receives over half of his or her support from the taxpayer, as in (1);
(ii) the taxpayer's home is the dependent disabled child's principal place of abode, as determined by 152(c)(1)(B) of the IRC and related U.S. Treasury Department regulations; and
(iii) a licensed physician has certified that the dependent child has a permanent disability constituting 50 percent or more of the body as a whole.
(b) The taxpayer must provide the physician's certification with the first tax return on which they claim the disabled child exemption. If the taxpayer files electronically, and is unable to attach the certification to the electronic filing, it must be mailed to:
Department of Revenue
P.O. Box 5805
Helena, MT 59604-5805.
An exemption for dependent child with disability may be disallowed if the department has not received a copy of the physician's certification.
(c) To the extent the child continues to qualify as a dependent with disability, the taxpayer does not need to provide documentation with succeeding returns.
(d) The taxpayer must inform the department, in writing, of any change in the child's eligibility for this exemption, to be mailed to the address provided in (b). Any year the taxpayer does not claim this exemption on the return would satisfy this written obligation.
(e) In the instance that a child was no longer eligible for at least one year, and regains eligibility, the taxpayer must comply with the requirements in (b) with a new certification for the year the child qualifies again.
(f) If, as of January 1, 2019, the taxpayer has not joined the physician's certification with a prior year's return, and the child has continuously been eligible, the taxpayer must keep the certification in their records to be provided to the department upon request.
(g) The dependent disabled child exemption may be claimed for a qualifying disabled child of any age.