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Level 2

Solved

Standard Deduction

8 replies
85 views

I am doing a tax return for my daughter. Her AGI is $10,763. Her standard deduction is $2,066 so she has to pay tax. Shouldn't her standard deduction be $12,400? Why would Turbotax have it at $2,066?

VolvoGirlAnswer

Level 15

Is she a dependent? What kind of income did she have?

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:

…..$1,100 or

…..Your earned income for the year + $350 (but not more than 12,400)

So you would get a minimum of $1,100.

See Table 8 Standard Deduction worksheet for Dependents on Page 25

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

Or the 1040 worksheet on page 32

https://www.irs.gov/pub/irs-pdf/i1040gi.pdf

VolvoGirlAnswer

Level 15

Is she a dependent? What kind of income did she have?

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:

…..$1,100 or

…..Your earned income for the year + $350 (but not more than 12,400)

So you would get a minimum of $1,100.

See Table 8 Standard Deduction worksheet for Dependents on Page 25

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

Or the 1040 worksheet on page 32

https://www.irs.gov/pub/irs-pdf/i1040gi.pdf

lmcoulterAuthor

Level 2

Yes, I claim her as a dependent. She had $1,716 in income and $9,067 in unemployment. I thought anything less than the standard deduction of $12,400 and she would get all her tax paid in back.

I claim my son as a dependent but he got the $12,400 deduction. He had $13, 168 from wages. Is that what is making the difference?

Level 15

yeah, this unemployment causes a problem for those that CAN be claimed as a dependent.

please review @VolvoGirl 's formula for the standard deduction.

note that unemployment is considered 'UNEARNED' - and that is causing this issue - as the standard deduction formula is EARNED income + 350,

$1716 + $350 should be the standard deduction or $2,066.