topic 2018 Standard deduction for college students in Deductions & credits

2018 Standard deduction for college students

Goodday441 — Sun, 30 Jun 2019 18:06:46 GMT

I'm a full time college student and with earned (working) and unearned income (unearned due to a 529 gift in the amount of the scholarship I received from my school). My total income is above $12K. Am I able to take the full $12K single deduction since it is less than my total income or am I subject to a lesser amount since 1) my parents claimed me as a "credit for other dependent" on their form and 2) I had earned and unearned (529 earnings) income? If I understood the IRS correctly, I think they were trying to tell me that I had to use the Kiddie formula for the standard deduction (greater of $1,050 or earned income + $350). I understood their formula for the adjusted deduction of less than $12K, but did not understand if it applied to me because of 1) my parents listing me as a "credit for other dependent" or 2) due to the unearned income from the gain on the 529 gift or 3) both. I had a feeling that it had to due with the unearned income; the earnings listed on the 1099Q.

Re: 2018 Standard deduction for college students

VolvoGirl — Sun, 30 Jun 2019 18:12:39 GMT

The Standard Deduction only depends on if you are claimed on someone else's return. How much was your W2 earned income?

If you are claimed as a dependent on someone else's return......

The Standard Deduction for an individual for whom an exemption can be claimed on another person's tax return is limited to the greater of:

…..$1,050 or

…..Your earned income for the year + $350 (but not more than 12,000)

See page 23 of Publication 501 and the worksheet on page 25

http://www.irs.gov/pub/irs-pdf/p501.pdf

Re: 2018 Standard deduction for college students

Goodday441 — Sun, 30 Jun 2019 18:45:31 GMT

Earned was $3,610.

Re: 2018 Standard deduction for college students

Goodday441 — Sun, 30 Jun 2019 19:00:20 GMT

Thank you for the information regarding Pub 501. I came up with the allowed deduction which was less than the $12K standard. The difference in tax owed for my allowed deduction and the $12K standard is approximately $800. If my parents did not claim me, do you think I could take the full $12K or would I still be subject to a lesser deduction due to the unearned income?

Re: 2018 Standard deduction for college students

Hal_Al — Sun, 30 Jun 2019 20:14:10 GMT

The rule is: you may NOT claim the full standard deduction if you qualify as your parent's dependent. It doesn't matter if they actually claim you or not.

So, you are still subject to a lesser deduction due to the unearned income and the fact that you qualify as their dependent.

A child of a taxpayer can still be a “Qualifying Child” (QC) dependent, regardless of his/her income, if:

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

Re: 2018 Standard deduction for college students

Goodday441 — Mon, 01 Jul 2019 01:00:40 GMT

Thank you...it's cut & dry for me. I qualify as a dependent for my parents. They did claim me, but it sounds like if they did not, I still would not qualify for the full $12K standard deduction as a college student filing single.

Again, thank you for taking the time to respond.