Do I have to file my 17 year old son as a dependant?

[thattimeoftheyear]

This year, i get the full 2000 tax credit, but next year, the tax credit for my son will only be $500.   I setup a brokerage account when he was about 5 years old, so he would have monies for college or first home.  I have been filing him separately for years as he has interest/dividends and capital gains.  He has however been filed as a dependent. 

Next year, i think it will be more of a savings if he files as single and i no longer claim him as a dependent so he can get his own tax deductions and maybe no longer be tied to our tax rate.  Currently, i file as Married Joint return with 1 dependent.

Is that allowed, or must he continue to file as a dependent?  His 2023 taxable income was 11,624.00

[MinhT1 · Accepted solution]

If your son is under 19 (or under 24 and a full time student) and he doesn't provide more than half of his own support for the tax year, you can claim him as a dependent. 

You do have the choice of not claiming him. If you don't claim him, then you lose the Other dependent credit of $500 and you can't claim his education credit from his form 1098-T.

As for your son, on his own tax return, he is asked the question whether he paid more than half of his living expenses with earned income. If the answer is No, then he must say that he can be claimed as a dependent by someone else. 

If someone can claim him as a dependent but does not actually claim him, he can claim the non-refundable part of the American Opportunity credit, but not the refundable part. If he doesn't have any tax liability, then there is no tax benefit for him.

[thattimeoftheyear]

Thank you, that answered a question i didn't even know i had.. The 1098-T will definitely come into play... I was not yet aware of that ability, and now that i have researched it a bit, thank you.  That answers that question...