If he is under 19 on December 31, then his student status is not an issue. The factors (besides age and relationship) are,
•residency--does he live in your home more than half the year not counting temporary absences
•support--does he provide more than half his own support.
You would need to add up his support costs, including food, clothing, transportation, entertainment. Include the fair market value of rent for the home you provide and an equal share of utilities. If he provides more than half his own support, he is not a dependent even though he meets the other tests.
If he is under 19 on December 31, then his student status is not an issue. The factors (besides age and relationship) are,
•residency--does he live in your home more than half the year not counting temporary absences
•support--does he provide more than half his own support.
You would need to add up his support costs, including food, clothing, transportation, entertainment. Include the fair market value of rent for the home you provide and an equal share of utilities. If he provides more than half his own support, he is not a dependent even though he meets the other tests.
There are two types of dependents, "Qualifying Children"(QC) and standard ("Qualifying Relative" in IRS parlance even though they don't have to actually be related). There is no income limit for a QC but there is an age limit, a relationship test and a residence test. Only a QC qualifies the taxpayer for the Earned Income Credit.
A child of a taxpayer can still be a Qualifying Child dependent, regardless of his/her income, if:
1. He is under age 19 (at year end), or under 24 if a full time student for at least 5 months of the year, or is totally & permanently disabled
2. He did not provide more than 1/2 his own support. Scholarships are considered third party support and not as support provided by the student.
3. He lived with the parent (including temporary absences such as away at school) for more than half the year
So, it doesn't matter how much he earned. What matters is how much he spent on support. Money he put into savings does not count as support he spent on him self.
The support value of the home you provided is the fair market rental value of the home plus utilities & other expenses divided by the number of occupants.
Furthermore, there is a rule that says IF somebody else CAN claim him as a dependent, he is not allowed to claim his own exemption. If he has sufficient income (usually more than $6300), he can & should still file taxes; he just doesn’t get his own $4050 exemption (deduction). In TurboTax, he indicates that somebody else can claim him as a dependent, at the personal information section.
Even if he had less, he is allowed to file if he needs to get back income tax withholding. He cannot get back social security or Medicare tax withholding.