Yes, that's true. By removing your daughter as your dependent, she may receive the Economic Recovery Credit.. If her income was below her 1/2 of her support, she may have to file Form 8615, Tax for children who have unearned income.. Here's the scenarios:
- Remove daughter as dependent - you don't file 8615, don't receive Other dependent credit for $500.
- Daughter files her own - needs to file Form 8615 if her earned income was less than i/2 of her support from the parents and unearned income over $2,200. If less, her tax will be based on parent's taxable income minus her taxable income.
You may have to choose the option that will benefit you and daughter.
