Summary. As NCperson noted I was wrong and my daughter can claim an education credit if she says to the TT interview that someone can claim her as a deduction and no one claims her. She was 20 at the end of 2023, doesn't pay for more than half her expenses, is full time, both parents are alive and required to file.
On my return as the parent if I don't claim her I lose $500 on Federal and the MD state does not change. (The TT interview is great in that if you change something it immediately shows the new tax).
On my daughter's return if she says to the TT interview she can be claimed and the parent doesn't claim her she gets around $700 non-refundable education credit. For the family a net gain of $200.
But for MD it's not the same as federal. MD has six filing status options. Option 6 is "dependent taxpayer". Her other choice would be option 1 "Single". The TT interview causes her to be put under option 6 and she loses the self-exemption which increases her MD tax significantly.
What's hard for me to understand is that for the education credit the federal makes a distinction between whether one can be claimed and whether they are claimed. MD does not with regard to the self exemption. I wonder why from MD's point of view she can't get the self-exemption if I don't claim her?
