As others mentioned, your daughter is subject to the “Kiddie Tax”. The requirement for who needs to file Form 8615 are listed under the Who Must File section here: https://www.irs.gov/instructions/i8615
It actually doesn’t matter whether you claim her as a dependent or support her, it’s if she under 18, or if she’s 18 (or 19-24 and full timr student) and doesn’t have enough earned income to cover half of her support (whether or not she used that earned income to help support herself).
My daughter is in the same situation, and based on what I’ve read about how the new exclusion of the first $10,200 of unemployment income from tax, it should help those subject to the kiddie tax a lot. So wait for TurboTax to implement. The remaining UI will still be taxed at parents’ rate but better than the full amount.
