You can claim an exemption for yourself, your spouse, and each of your dependents. You can generally deduct $3,950 from your adjusted gross income for each exemption you claim in 2014, which will lower your taxable income.

The total number of exemptions is reported on Line 6d of Form 1040, and the total dollar amount of exemptions is reported on Line 42 of Form 1040.

For 2014, the personal exemption is subject to a phase-out starting with and adjusted gross incomes of $152,525 ($305,050 for married couples filing jointly). The exemption is fully phased out for taxpayers with incomes above $213,775 ($427,550 for married couples filing jointly).

To claim the exemption for a dependent, the dependency tests outlined in IRS Publication 501 (starting on page 11) must be met. If you claim an exemption for a dependent (such as your child), then that dependent cannot claim a personal exemption on his or her own tax return.

Refer to IRS Publication 501 and Dependents - Rules for Claiming for additional information about exemptions and whom you may claim as a dependent. You may also wish to utilize the IRS Interactive Tax Assistant (ITA) topic Who can I claim as a dependent?