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swales269
New Member

How do I determine if claiming my college age children as dependents is better than having them file separately?

 
1 Reply
Hal_Al
Level 15

How do I determine if claiming my college age children as dependents is better than having them file separately?

You can use this tool to compare test returns each way. https://turbotax.intuit.com/tax-tools/calculators/taxcaster/?s=1.

But be aware, it is not really optional. There is a rule that says IF somebody else CAN claim him as a dependent, he is not allowed to claim himself. If he has sufficient income (usually more than $12.000), he can & should still file taxes. In TurboTax, he indicates that somebody else can claim him as a dependent, at the personal information section.  TT will check that box on form 1040.

Furthermore, there's a new urban myth among college students that says they can get a $1000 from the government just for filing a tax form. For most of them, they simply aren't eligible. A student, under age 24, is only eligible for the refundable portion of the American Opportunity Credit if he supports himself by working. He cannot be supporting himself on parental support, 529 plans or student loans & grants.  It is usually best if the parent claims that credit. 

He cannot claim a credit if he is, or can be, claimed as a dependent by someone else**.


**Technically there is a provision that allows your student dependent to claim a tuition credit, from a practical matter it seldom works out.   If the student actually has a tax liability she can claim a non-refundable credit but then the parent must forgo claiming the student's dependent credit  and the student still can’t claim himself.

https://ttlc.intuit.com/questions/3936383-tuition-gift-to-children

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