Deductions & credits

@Photium my disclaimer: what I posted here should not be interpreted as tax advice.  You should check with a tax professional for advice.  I am here just to explain my thinking and welcome others to correct me if I am wrong.

 

According to IRS publication 501, "your child is considered to have lived with you during the periods of time when one of you, or both, are temporarily absent due to special circumstances, such as: illness, education, business,...".   Those are exceptions for temporary absences.  So even if you were absent from home for 12 months due to Covid, those absence is considered due to education or illness, then you are still considered living with your parents for those 12 months.  That's my interpretation.

 

In the same IRS publication 501, it says "A scholarship received by a child who is a student isn't taken into account in determining whether the child provided more than half of his or her own support".   

 

According to IRS Publication 970 , Pell Grants and Other Title IV Need-Based Education Grants are treated as scholarships for purposes of determining their tax treatment.  You may have received a Form 1098-T, which shows the amount of scholarships or grants.  Your total annual needed support is well over $20K including tuition, and apparently you did not provide over half of your support from your own resources, then you are a qualifying child per dependence test.  And your parents can claim you as their dependent.  Because your parents can claim you as a dependent, they may be able to get Credit for Other Dependent (ODC) of $500 depending on their income.  If they can claim ODC, they can give the $500 to you when they get it from IRS.  

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