Can a parent claim me as dependent?

[CrunchyCookies]

Do I qualify as dependent of my mom?Turning 22 in Dec. I work and go to school part time (grants covered my tuition). I filed my tax last year, but I was claimed by my mom as her dependent including my 1098-t. I live with her and also under her health insurance. If she does claim me who uses the 1098-t?  

[xmasbaby0]

Since you are not  a full-time student, whether you can be claimed as a dependent is determined by how much you earned by working.   You say you worked----how much have you earned in 2025?    Since you cannot be a qualifying child dependent, we need to know how much your 2025 income has been in order to tell if you could be a qualified relative dependent for your parent.    If you earned more than $5200 you cannot be claimed.

[Hal_Al]

There are two types of dependents, "Qualifying Children"(QC) and Other ("Qualifying Relative" in IRS parlance even though they don't have to actually be related). There is no income limit for a QC but there is an age limit, student status, a relationship test and residence test.

A child of a taxpayer can still be a “Qualifying Child” (QC) dependent, regardless of his/her income, if:

1. He is under age 19, or under 24 if a full time student for at least 5 months of the year, or is totally & permanently disabled
2. He did not provide more than 1/2 his own support. Scholarships are excluded from the support calculation
3. He lived with the parent (including temporary absences such as away at school) for more than half the year

So, if you are over 18 and not a full time student, you cannot be a QC.  There is a $5200 income test that determines if you can be claimed as a qualifying relative dependent.  The $5200 is not limited to earned income.

This question usually comes up in determining who gets to "claim the 1098-T" for the generous education credit, because of a special rule that limits college age students from claiming it.*  The simple answer is: you get to claim it (even if you are under 24) since you are not a full time student and do not qualify as your parent's dependent. 

*There's a new urban myth among college students that says they can get a $1000 from the government just for filing a tax form. For most of them, they simply aren't eligible. A full time unmarried student, under age 24, even if you don't qualify as a dependent, is only eligible for the refundable portion of the American Opportunity Credit if he supports himself by working. You cannot be supporting yourself on parental support, 529 plans or student loans & grants. It is usually best if the parent claims that credit. 

You cannot claim the (up to) $1000 refundable credit if you are, or can be, claimed as a dependent by someone else.

Reference: Line 7 instructions for form 8863.

https://www.irs.gov/instructions/i8863#en_US_2024_publink53002gd0e674

https://www.irs.gov/instructions/i8863

[CrunchyCookies]

Hello,

My W-2 isn’t provided yet, but I am sure it is more in reference to my income last year. Does my eligibility as her dependent affects our health insurance? I looked it up, and just want to confirm since we have to renew our plan soon. 

Thank you in advance, I really appreciate your help. 

[xmasbaby0]

We help with questions regarding income tax returns and the use of the tax preparation software.  We cannot advise you about a health insurance plan.   If you are planning to get a plan through healthcare.gov, you need to talk to a representative of healthcare.gov during open enrollment in November and early December.

[Hal_Al]

As others have said, you need to verify that with your health plan insurer. 

That said, "the 'under 26 rule' allows young adults to stay on their parents' health insurance plan until they turn 26, regardless of their marital status, living situation, or financial dependence. This rule, a provision of the Affordable Care Act (ACA), applies to most individual and employer-sponsored plans. When a dependent turns 26, their coverage typically ends, which triggers a Special Enrollment Period for them to find their own health insurance."

[Hal_Al]

You stated that "grants covered my tuition".

There is a tax “loop hole” available to claim an education credit, for the parents of students on scholarship. The student must be half time or more.  The student reports all his scholarship, up to the amount needed to claim the American Opportunity Credit (AOC), as income on his return. That way, the parents  (or himself, if he is not a dependent) can claim the tuition credit on their return. They can do this because that much tuition was no longer paid by "tax free" scholarship.  You cannot do this  if the conditions of the grant are that it be used to pay for qualified expenses.

Using an example: Student has $10,000 in box 5 of the 1098-T and $8000 in box 1. At first glance he/she has $2000 of taxable income and nobody can claim the American opportunity credit. But if she reports $6000 as income on her return, the parents can claim $4000 of qualified expenses on their return.

Books and computers are also qualifying expenses for the AOC. So, extending the example, the student had another $1000 in expenses for those course materials, paid out of pocket. She would only need to report $5000 of taxable scholarship income, instead of $6000.

The IRS actually encourages use of this technique. From the form 1040 instructions: “You may be able to increase an education credit if the student chooses to include all or part of a Pell grant or certain other scholarships or fellowships in income. For more information, see Pub. 970, the instructions for Form 1040 and IRS.gov/EdCredit".  PUB 970 even has examples of how to do the “loop hole”.

A student, with little or no other income, can have up to $15,750 of taxable scholarship and  working income  (in 2025) and still pay no income tax.