I am a high income wage earner and pay my two children's college tuition and expenses. Is there a benefit to claiming them as dependents?
If your MAGI is over $90,000 ($180,000 for married taxpayers filing joint), you can't claim the credit.
If over those limits it might be better to not claim them and let them get the education credit. Note that they would have to have a filing requirement and owe income tax to get any benefit since they would not receive the refundable portion of the credit. They must also on their return check the box saying that someone else can claim them.
The only way to tell is to add them as Dependents. Also consider your State taxes. But note that, if you choose not to claim them, they still cannot "claim themselves" nor receive any stimulus monies.
There is the $500 Credit for Other Dependents (aka “Family Tax Credit”) that was signed into law as part of the 2017 Tax Cuts and Jobs Act and is in effect for tax years 2018 through 2025.
The credit allows taxpayers a credit for certain dependents that don't qualify for the Child Tax Credit, such as qualifying children age 17 or older, adult dependents, and dependents who have an ITIN.
The credit is $500 per qualifying dependent as long as your adjusted gross income (AGI) doesn’t exceed $200,000 ($400,000 if filing jointly). The credit goes down $50 for every $1,000 that the AGI exceeds the $200,000/$400,000 limit.
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