I have a question about dependants. Or more particurally, how not to be one anymore. I am 20 years old and living and going to school in NC. My parents also live in NC, and as of this past April are still claiming me on their taxes. They live at the other end of the state. I rent my own apartment, and for the past three years have paid for my own schooling. I am not sure about this year because they have finally qualified for a PLUS loan, which as of tonight I have not convinced them to take. I also pay for my own insurance. The most financial help I have gotten from them is my Mom helped me do laundry at the laundry mat and has bought me a window air conditioner. What process do I need to go though to no longer be claimed as a dependant? It is affecting my financial aid because my mother is rich, while I have only 32 cents in the bank. (hard month, to say the least.)
Hope this makes sense, its late!
2007-06-19 19:05:01 · 3 answers · asked by carls812 4 in Business & Finance ➔ Taxes ➔ United States
Is there anyway to keep them from claiming me on their return? Please don't is probably not going to work. Thanks for your answer!
2007-06-19 19:32:58 · update #1
EEEK! In that case, how on earth am I to ever get financial aid?
2007-06-19 19:37:42 · update #2
One of the tests for dependency is that they have provided more than half of your support for the entire year. You haven't provided enough information to determine that with absolute certainty although it certainly does sound as if you are providing more than half of your own support.
Another test is that you must reside in their home, excluding temporary absences for school, etc. If you've been continuously living in your own apartment for the past 3 years with no intention of ever returning to their home, you probably don't meet that test either.
Based upon the information given, I'd say that it's pretty clear that you are no longer their dependent. You assert that status by filing your tax return and claiming your own personal exemption. If your parents have claimed you as a dependent the IRS will contact you both and ask for proof of your claims. They will then make a determination based upon the law and settle the matter. If you both e-file, the first return filed will generally be accepted and the second one will be rejected. If this happens to you, you'll have to file a paper return and mail it in.
Keep in mind that this will NOT affect your financial aid situation. Until you reach age 24 or 25 (don't recall which) the total family income is taken into consideration even if your parents are not contributing to your educational costs or support. There might be a way that you can be treated as independent for FA purposes, speak to your FA counsellor about that; it's not a tax issue.
2007-06-20 00:28:23 · answer #1 · answered by Bostonian In MO 7 · 0⤊ 0⤋
Not being a dependant will have no effect on your financial aid. They don't care about your filing status, because anyone could file separately from their parents. They'll go after both of your parents (and/or both sets of step-parents) tax returns and assets to figure out EFC.
You need to learn about how taxes work. If you don't have much income and your parents have a lot, they save more money by claiming you as a dependant than you would if you filed separately. Whoever claims you probably saves $1000 in taxes, so ask them for it :)
2007-06-20 02:33:31 · answer #2 · answered by teehee 3 · 0⤊ 0⤋
your case is simple -
you claim yourself on your return and your parents don't claim you on their return.
2007-06-20 02:31:39 · answer #3 · answered by Anonymous · 0⤊ 0⤋