TurboTax says I don't qualify for the education credit b/c someone else is claiming son as dependent, but he selected someone can claim him as a dependent on his return.

[cebaugh0717]

I've checked everything. We (the parents) have him listed as a dependent, and he selected someone else can claim him on his return. He is a first year college student. Please help!

[pamelaeg]

Caveat  - I use the desktop version of TT.

When you add (or edit) your dependent it will ask several questions.  The most likely reason he would not show as eligible is: (1) that you accidentally answered one of the questions about there being a custody agreement that allowed another parent to use them, (2) you indicated they did not live with you the majority of the year - students should be counted as living at home even if they are 'temporarily' away at college, (3) you said you did not provide more than 50% of his support, (4) you indicated someone else in your household provided more than 50% of his support.

I know you said you checked everything but I would go back through all of those questions again.

By the way, at this point in the process, neither TT or the IRS will know what he marked on his return.

Hope this helps.  

[cebaugh0717]

I appreciate your response. I went back to double check again, and I completed everything correctly. TT even states that he qualifies as my dependent. I also went back to his return, and he clicked "someone else can claim me as a dependent" on his return, as I've read he has to do in order for us to claim him as our dependent. I don't know what to do. 

[MarilynG1]

When you first go into the Education section, TurboTax asks 'tell us which person was a student' and displays choices of who might be eligible for a credit.  If your son appears on this list, he is properly your dependent.  The error message may be misleading as to the cause of not receiving a credit. 

I would guess that the error is in the following screens, or the 1098-T entry.  Make sure 'at least half time' is indicated, and that Box 1 on the 1098-T (Tuition) is larger than Box 5 (Scholarships) to qualify for an Education Credit.

In the Personal Info section, Edit your dependent and make sure he's indicated as a Student. You could also check the 'People Worksheet' if you're using TurboTax Desktop and make sure he's 'linked' to you.

@cebaugh0717 

[dhalsim2]

I suspect that the error message is wrong.  I'm receiving it as well.  I double checked my two college kids and verified that they are both dependents, but this tax year my income exceeded the education credit income limits ($180,000), whereas last tax year it didn't, so I was able to claim the credit.  I think that TT Online may be legitimately disallowing it, but with a bad error message.