College student claimed as dependent

Forum|Forum|2 years ago
April 8, 2024
3 replies
45 views

Tax question. My son 19 yrs is in college 2nd year. He has W2(< 800) from college helping in the lab in the campus. Also some investment I have on his name(not huge). Should I or not, include him in my tax return as dependent? I noticed, if I add him to our tax as dependent and mention the same on his return, his tax rate is our rate and charged $$ tax on the int/div on his return. I am not sure what am I going to loose if I don’t add him in our tax return. Can I even do that? He does not have income to support. I am paying his college fees and some from 529.

On his return if I choose "he is not claimed as dependent" I see his tax is $100 vs $1000. Don't know how it is calculating. I am guessing he is taxed on our rate instead of his rate for the div/int?

DavidD66

Level 15

Is the unearned income (dividends) more than $2,500? The Kiddie Tax applies if your child:

has unearned income (usually from investments) exceeding $2,500
is required to file a return
isn’t filing jointly
is under age 19 (or 24 if a full-time student) as of January 1, 2024

For more information on the Kiddie Tax, see the TurboTax Article: What is the Kiddie Tax?

As for claiming him on your tax return: If he qualifies as your dependent, you don't have to claim him. but he has to indicate that someone CAN claim him as a dependent.

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VSN7Author

Level 2

Yes. I thought kiddie tax might have applied but questions is that should have been irrespective of he is claimed as dependent or not. His invest int/div is > 2500. Why for the same details, if he is not a dependent checked on his return his tax is $100 where as if I mark it as he is dependent on ours his tax is $1000?

AmyC

Level 15

When you are filing as a dependent, your standard deduction is your earned income + $400. When you are filing on your own, the standard deduction is $13,850. That is a huge difference in taxable income.

Children who only have earned income from a job or self-employment, don’t make enough money to be required to file, or are filing jointly with their spouses are exempt from the Kiddie Tax.

@VSN7

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