@danilol wrote:
I am a little confused.
My daughter W2 income is $7175, there are both federal and state withheld. We claimed her as dependent.
Does she have to file her tax seperatly even she choose to give up taking back withheld?
she is 21 and full time student.
1. A person always files their own tax return to claim income earned from working. The only time that a child's income can be added to a parent's tax return is if the child's income is only from investments and less than a certain dollar amount.
2. A child earning money and filing a return does not necessarily interfere with the ability of a parent to claim them as a dependent, as already covered. But, the child must answer "yes, I can be claimed as a dependent by someone else" on their tax return. This will affect their eligibility for certain tax benefits including EIC and some education credits. (The education credits should be claimed by the parents if the parents claim the child as a dependent.)
3. The income threshold to be required to file a tax return for dependents is complicated. If her only income is earned from working, the threshold is $12,550. If she also has unearned income (such as certain scholarships, prizes, investment income, gambling winnings, unemployment compensation), the filing threshold may be lower. You can use the IRS web site to determine if she is required to file.
https://www.irs.gov/help/ita/do-i-need-to-file-a-tax-return
4. Your daughter must file a tax return if she wants a refund of her tax withholding. The IRS will pay the refund as long as the tax return is filed less than 3 years from the usual deadline. She may file a return and claim a refund even if she is not required to file.
5. The income requirement to file a state tax return may be different than the requirement to file a federal return. You may want to check with your state. She must file a state tax return to claim a refund of the state tax withheld from her paycheck.
