Will not claiming my 18 yo daughter on my taxes, allow her to pay less taxes thereby getting a larger refund?

You do not get to choose that.   If she CAN be claimed then she is required to say she can be claimed as a dependent on someone else's tax return.

 

https://ttlc.intuit.com/community/dependents/help/when-do-i-have-to-answer-yes-to-being-claimed-as-a-dependent/00/1994319

 

 

She can file a tax return to seek a refund of tax withheld from her pay.   And you can still claim her as a dependent even if she files a tax return.

 

MY DEPENDENT HAD A JOB

If your dependent has a W-2 for his after-school job, summer job, etc. you do not include the information on your own return. You can still claim your child as a dependent on your own return.  He/she can file his own return for a refund of some of his withheld wages (he won’t get back anything for Social Security or Medicare), but MUST indicate on it that he can be claimed as a dependent on someone else’s return.  (Supervise this closely or prepare it for him!)

If your dependent’s earnings were over $400 and were reported on a 1099Misc or 1099NEC then he must file a return and pay self-employment tax for Social Security and Medicare.

 

 

You might also want to use free software from the IRS Free File versions:

https://apps.irs.gov/app/freeFile/

 

WHO CAN I CLAIM AS A DEPENDENT?

 

You can claim a child, relative, friend, or fiancé (etc.) as a dependent on your 2021 taxes as long as they meet the following requirements:

Qualifying child

• They're related to you.
• They aren't claimed as a dependent by someone else.
• They're a U.S. citizen, resident alien, national, or a Canadian or Mexican resident.
• They aren’t filing a joint return with their spouse.
• They're under the age of 19 (or 24 for full-time students).
• No age limit for permanently and totally disabled children.
• They lived with you for more than half the year (exceptions apply).
• They didn't provide more than half of their own support for the year.

Qualifying relative

• They don't have to be related to you (despite the name).
• They aren't claimed as a dependent by someone else.
• They're a U.S. citizen, resident alien, national, or a Canadian or Mexican resident.
• They aren’t filing a joint return with their spouse.
• They lived with you the entire year (exceptions apply).
• They made less than $4,300 in 2021.
• You provided more than half of their financial support.

When you add someone as a dependent, we'll ask a series of questions to make sure you can claim them. There may be other tax benefits you can get when you claim a dependent.

 

 

 

Q. Will not claiming my 18 yo daughter on my taxes, allow her to pay less taxes thereby getting a larger refund?

 

As others have said, it's not optional.  But,  with the tax law change, effective 2018, most dependents will get the same refund whether they claim themselves or not. The personal exemption has been eliminated and the standard deduction increased.  But, you will lose the$500 (non refundable) other dependent credit . The covid stimulus money has changed that somewhat for tax years 2020 and 2021.  Specifically, if you got the $1400 dependent stimulus because she was your dependent in 2020, she can now get the $1400, as a recovery rebate credit, on her 2021 return, if she is not and cannot be, a dependent

 

If she is a student, it is better that you claim the tuition credit.  There are restrictions on a student getting the refundable portion of the credit. 

To further clarify:

You the parent have a choice. The 18 yr old dependent does not.

If the parent "qualifies" to claim the dependent, then they have a choice to claim or not claim the dependent.

If the 18 year old qualifies to be claimed as a dependent, then they do not have a choice. They must indicate "I can be claimed on someone else's return". It does not matter if that "someone else" actually claims them or not.