@TAM2024 wrote:
What about her student loan ? Is this considered support? And any scholarships? The loan would be in her name but as always, her dad had to co-sign.
thanks
You should probably read publication 501 carefully.
https://www.irs.gov/forms-pubs/about-publication-501
If we stick to the rules for "qualifying child dependent", this means a child who is:
a. under age 19, or under age 24 (on Dec 31 of the tax year) while also a full time student,
b. lives at home more than half the year (with time away at college usually being treated as "living at home" and,
c. did not provide more than half their own support.
For this test, you add up the child's total support cost, and the total amount they spend on themselves. The child's total support cost includes room and board, tuition, clothing, medical, entertainment, travel and so on. For room and board, include both room and board paid to college (or an off-campus apartment) and also include the value of the home that the parents still provide for the child "at home" while the child is away at college.
Then you add up how much the child pays toward their own support. It does not matter if other support comes from parents, grandparents, or other friends and family, what matters is whether the child pays more than half. The child pays for their own support if they borrow money for expenses (because they promise to pay it back), or they earn money from a job for their expenses, or if they withdraw money from investments for their expenses. But, if the child uses their money to support someone else, that is not support they provide themself. So the calculation is not just about how much they earn or withdraw from savings, but how they use it.
For this test, scholarships are ignored on both sides of the equation. If tuition is $50,000 but the has a $25,000 scholarship, you would simply include tuition equals $25,000 in your calculation.
For this test, loans taken out in the child's name are counted as support the child provides for themself, as long as the child is the primary borrower. (If the parent is a co-signer, it is still support provided by the child, but if it is a parent loan, it is support provided by the parent.)
