If you "can" claim her then she needs to amend to un-claim herself by checking the box that another taxpayer can claim
While nobody can be compelled to claim a dependent, a dependent cannot claim them self if they can be claimed by another tax payer - the tax law does not allow that.
That is why there are two questions in the interview - *can* you be claimed as a dependent by another taxpayer, and *were* you (or will you) actually be claimed by that taxpayer?
In both cases the dependent will not get their own $4,505 personal exemption. If the answer to the second question is "yes" then the taxpayer claiming the dependent gets it, if the answer is "no" the exemption is lost, but the dependent is then allowed to claim certain educational credits that cannot be claimed by a dependent if they are actually claimed.
See IRS Pub 17 Personal Exemptions - Your Own Exemption
https://www.irs.gov/publications/p17/ch03.html#en_US_2016_publink1000170848
You can take one exemption for yourself unless you can be claimed as a dependent by another taxpayer. If another taxpayer is entitled to claim you as a dependent, you can’t take an exemption for yourself even if the other taxpayer doesn't actually claim you as a dependent.
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---Tests To Be a Qualifying Child---
(Must pass ALL of these tests)
NOTE: If a child passes all of these tests he must say “yes” on his/her own tax return (if he/she files one) that another taxpayer CAN claim him/her as a dependent even if they DO NOT claim him/her)
1. The child must be your son, daughter, stepchild, foster child, brother, sister, half brother, half sister, stepbrother,stepsister, or a descendant of any of them.
2. The child must be (a) under age 19 at the end of 2016, (b) under age 24 at the end of 2016 and a full-time student* for any part of 5 months of 2016, or (c) any age if permanently and totally disabled and must be younger than you (or your spouse if filing jointly).
3. The child must have lived with you for more than half of the year (There are exceptions for temporary absences such as school, illness, business, vacation, military service).
4. The child must not have provided more than half of his or her own support for the year.
5. If the child meets the rules to be a qualifying child of more than one person, you must be the person entitled to claim the child as a qualifying child.
6. The child is not filing a joint return.
7. The child must be a U.S. citizen, U.S. resident alien, U.S. national, or a resident of Canada or Mexico
*A full-time student is a student who is enrolled for the number of hours or courses the school considers to be full-time attendance during some part of each of any 5 calendar months of the year.
See IRS Publication 17 for more information.
https://www.irs.gov/publications/p17/ch03.html#en_US_2016_publink1000170876
**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**
