Twin and family studies implicitly assume that the covariation between family members remains constant across differences in age between the members of the family. However, age-specificity in gene expression for shared environmental factors could generate higher correlations between family members who are more similar in age. Cohort effects (cohort × genotype or cohort × common environment) could have the same effects, and both potentially reduce effect sizes estimated in genome-wide association studies where the subjects are heterogeneous in age. In this paper we describe a model in which the covariance between twins and non-twin siblings is moderated as a function of age difference. We describe the details of the model and simulate data using a variety of different parameter values to demonstrate that model fitting returns unbiased parameter estimates. Power analyses are then conducted to estimate the sample sizes required to detect the effects of moderation in a design of twins and siblings. Finally, the model is applied to data on cigarette smoking. We find that (1) the model effectively recovers the simulated parameters, (2) the power is relatively low and therefore requires large sample sizes before small to moderate effect sizes can be found reliably, and (3) the genetic covariance between siblings for smoking behavior decays very rapidly. Result 3 implies that, e.g., genome-wide studies of smoking behavior that use individuals assessed at different ages, or belonging to different birth-year cohorts may have had substantially reduced power to detect effects of genotype on cigarette use. It also implies that significant special twin environmental effects can be explained by age-moderation in some cases. This effect likely contributes to the missing heritability paradox.