(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.

(2) A dependent exemption is not allowed for an individual described in (1) :

(a) who, during the calendar year, has gross income of $800 or more unless the individual is the taxpayer's child and either:

(i) has not attained the age of 19 at the close of the calendar year in which the tax year of the taxpayer begins; or

(ii) is, during each of five calendar months during the calendar year in which the tax year of the taxpayer begins, a fulltime student at an educational institution or is pursuing a fulltime course of institutional on-farm training under the supervision of an accredited agent of an educational institution or of a state or political subdivision of the state;

(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) Except as provided in (7) , in lieu of the dependent exemption described in (1) , a taxpayer is allowed a dependent disabled child exemption as provided in this section and (4) , (5) , (6) , (7) , and (8) , equal in amount to twice the dependent exemption. The exemption is allowed for a child who receives over half of his or her support from the taxpayer if:

(a) the taxpayer's home is the dependent disabled child's principal place of abode;

(b) the dependent child has a permanent disability constituting 50% or more of the body as a whole; and

(c) a licensed physician has certified the qualifying disability.

(4) For each tax year beginning before December 31, 2002, a taxpayer claiming a dependent disabled child deduction must file a physician's certification of qualifying disability with their individual income tax return.

(5) For tax years beginning after December 31, 2002, filing an annual certification is not required, but the taxpayer must have a physician's certification of qualifying disability that they retain as a tax record and provide the department upon request. In addition, the taxpayer makes the following representations when filing a return claiming a dependent disabled child exemption:

(a) if the taxpayer has filed the physician's certification with a prior year's return, the taxpayer represents there is no change in the dependent's physical circumstances to the extent the dependent no longer qualifies for the exemption; and

(b) if the taxpayer has not filed the physician's certification with a prior year's return, the taxpayer represents they have a copy of the certification of a licensed physician of a qualifying disability and there is no change in the dependent's physical circumstances to the extent the dependent no longer qualifies for the exemption.

(6) The dependent disabled child exemption may be claimed for a qualifying child of any age and may be claimed for a qualifying child who has gross income of $800 or more.

(7) A dependent disabled child exemption is not allowed for an individual who makes a joint return with his or her spouse.

(8) The amounts allowed as a dependent exemption are:

(a) for tax years beginning before December 31, 2004, the dependent exemption is $800, adjusted annually for inflation by November 1 or each year as provided in 15-30-112 , MCA (temporary) ; and

(b) for tax years beginning after December 31, 2004, the dependent exemption is $1,900, adjusted annually for inflation by November 1 of each year as provided in 15-30-112 , MCA (effective January 1, 2005) .

(9) A taxpayer claiming a dependent disabled child deduction for a tax year beginning after December 31, 2002 is required to notify the department if the child's physical circumstances have changed and the child no longer has a permanent disability constituting 50% or more of the whole body and of any other change in the child's eligibility for the dependent disabled child exemption. The notice must be in writing and mailed to the Department of Revenue, P.O. Box 5805, Helena, MT 59604-5805.