But I already filed my return...
Assuming the filed return is accepted by the IRS, you'll have to file an amended return. You also didn't indicate their ages or potential student status in 2020.
But the people I claimed are very upset.
The IRS and tax law doesn't care about personal feelings unfortunately. But if family, they'll get over it.
If the dependents were:
- Under the age of 24 on Dec 31 of the tax year and;
- Enrolled as a full time student for any one semester that started in the tax year, and;
- Were enrolled at an accredited educational institution, and;
- Were enrolled in a course of study that will lead to a degree or credentialed certification, and;
- Did not provide more than 50% of their own support (scholarships, grants, 529 distributions and all other 3rd party income does not count for the student providing their own support) then;
The parent(s) qualify to claim the student a a dependent on the parent's tax return.
The key word here is *QUALIFY*. It does not matter if the parent(s) actually claim the student or not. If the student is required to file a tax return, then the student must select the option for "I can be claimed as a dependent on someone else's tax return.". It flat out does not matter if the parent actually claims the student or not. The parent has a choice. The student does not have a choice.
Please take note with the above what is "not" mentioned in the requirements for the student to qualify as a dependent.
- The student's earnings *do* *not* matter. The student could earn a million dollars (literally!) and still qualify to be claimed as a dependent on the parent(s) tax return.
- There is not requirement for the parent(s) to provide the student any support. Not one single penny. The support requirement is on the student, and only the student.
- Take note there is an enrollment requirement only. There is not an attendance requirement, nor is there any requirement to actually pass a course or courses. (But if the student drops a course without taking up another in it's place, then it doesn't count.)
There are only two possible ways the student can provide more than half of their own support.
1) The student was self-employed or had a W-2 job and earned sufficient amount during the tax year to justify and support a claim to providing more than half of their own support. Additionally, that earned income must be more than the total of all scholarships, grants, 529 distributions and any other 3rd party income received by the student during the tax year.
2) The student (not the parent) is the *primary* borrower on a *qualified* student loan, and sufficient funds were distributed from the lender to the student during the tax year to justify and support a claim to providing more than half of their own support. Additionally, the distributed funds must be more than the total of all scholarships, grants, 529 distributions and any other 3rd party income received by the student during the tax year.
If the above doesn't apply to you and you incorrectly claimed them as dependents, then understand this:
The ones you claimed have "no choice" but to print, sign and mail their 2020 returns to the IRS, no matter what you do. If your e-filed return is accepted by the IRS, then the dependent's SSN's are marked as "claimed" for 2020 in the IRS computers, and absolutely "NOTHING" will change that. Not ever. So even if/when you amend, they will still have to print, sign and mail their returns to the IRS.
If you amend, be aware that normally an amended return can take 6-8 weeks to process since they are basically done by hand. Last year, that was stretched out to months due to the pandemic. How that has changed for 2020, I don't know. From what I understand it is now possible to e-file an amended return. How that affects processing time, I have no idea. We'll just have to learn and figure it out as we go I guess.
