topic Does it affect me or my parents if I'm a dependant on my parents taxes and I start working and file my own taxes? in Get your taxes done using TurboTax

Does it affect me or my parents if I'm a dependant on my parents taxes and I start working and file my own taxes?

alexevan2k — Thu, 06 Jun 2019 14:19:23 GMT

If you are still a dependent then your parents get to use...

xmasbaby0 — Thu, 06 Jun 2019 14:19:25 GMT

If you are still a dependent then your parents get to use your personal exemption on their return, which lowers the amount of income they are taxed on by $4100. And they still qualify for earned income credit within certain income limits if you are a dependent. Your income does not get entered on your parents' income tax return.

If you can be claimed as a dependent on your parents’ return, you can still file your own return so that you can receive a refund of taxes withheld. (You will not get back anything for Social Security or Medicare withheld.) You will not get the $4100 personal exemption. Be sure that on your own return you say that you can be claimed as a dependent on someone else’s return.

If you file your own tax return, saying that you can be claimed as a dependent on someone else's return is very important. If you answer that question in Personal Info the wrong way, you cause your parents' e-filed return to be rejected and they have to file by mail--and you have to file an amended return, which will take months for the IRS to process.

Ooops--personal exemption is $4050.

xmasbaby0 — Thu, 06 Jun 2019 14:19:26 GMT

Ooops--personal exemption is $4050.

"Does it affect me or my parents if I'm a dependent on my...

Hal_Al — Thu, 06 Jun 2019 14:19:30 GMT

"Does it affect me or my parents if I'm a dependent on my parents taxes and I start working and file my own taxes?"

Yes. A person's exemption ($4050 deduction) can only be claimed on one tax return (either yours or your parent's; but not both). That mean one of you will be paying tax on an additional $4050 of income.It's best if your parents still continue to claim you. Not only are they taxed at a higher rate, child dependents mean additional tax breaks.

That said, it's not optional who gets to claim you. The rules must be followed. A child of a taxpayer can still be a “Qualifying Child” (QC) dependent, regardless of his/her income, if:

1. He is under age 19, or under 24 if a full time student for at least 5 months of the year, or is totally & permanently disabled

2. He did not provide more than 1/2 his own support. Scholarships are considered third party support and not as support provided by the student.

3. He lived with the parent (including temporary absences such as away at school) for more than half the year

So, it doesn't matter how much he earned. What matters is how much he spent on support. Money he put into savings does not count as support he spent on him self.

The support value of the home you provided is the fair market rental value of the home plus utilities & other expenses divided by the number of occupants.

Furthermore, there is a rule that says IF somebody else CAN claim him as a dependent, he is not allowed to claim his own exemption. If he has sufficient income (usually more than $6350), he can & should still file taxes; he just doesn’t get his own $4050 exemption (deduction). In TurboTax, he indicates that somebody else can claim him as a dependent, at the personal information section.

Even if he had less, he is allowed to file if he needs to get back income tax withholding. He cannot get back social security or Medicare tax withholding.