I cannot claim my Student Loan Interest because I can be claimed as a dependent on someone else's return, but they can't claim me because I earned over $4500 in 2023.

[kajach3]

and not disabled so why can't I claim interest if they can't claim me as dependent?

[Hal_Al]

Q.  Why can't I claim interest if they can't claim me as dependent?

A. You can claim the interest deduction if no one can claim you as a dependent.  If TurboTax (TT) isn't letting you do that, you've entered something wrong; most likely in the personal info section.

But the real question is CAN you be claimed. The statement, "they can't claim me because I earned over $4700 in 2023" is wrong. There is no income limit for most parents claiming their college age children.

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, it doesn't matter how much he earned. What matters is how much he spent on support. Money he put into savings does not count as support he spent on himself.

The support value of the home, provided by the parent, is the fair market rental value of the home plus utilities & other expenses divided by the number of occupants.

The IRS has a worksheet that can be used to help with the support calculation. See: http://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf

[rjs]

TurboTax does not look at your income or anything else to determine whether you can be claimed as a dependent. The way it determines whether you can be claimed as a dependent is by asking you. At the very beginning of the interview, after you enter your name, birth date, and Social Security number, the next screen asks you if certain situations apply to you. One of the situations that's listed is that another taxpayer can claim you on their tax return. If you check that box, you have told TurboTax that you can be claimed as a dependent. If you don't check that box, you have told TurboTax that you cannot be claimed as a dependent. That's the only way TurboTax knows whether or not you can be claimed as a dependent.

Go back to the Personal Info section and see if you checked the box that says another taxpayer can claim you on their tax return. But if you don't check the box, make sure you're right. If you say that you cannot be claimed, and someone else claims you, it will cause trouble for them or you or both.