I am a full time student, graduating in June 2008. I have a job starting in August 2008 and I will be making $50,000 annually. Should I claim as an independent in 2008 for tax purposes or give my parents the advantages of claiming me as a dependent? (since I am under 23 and I guess I will still be considered a full time student for that tax year since I will be in school until June). Sorry if this is a little complicated.. thanks for the help... My main concern is paying income tax btw.
2007-12-14 12:17:10 · 6 answers · asked by Anonymous in Business & Finance ➔ Taxes ➔ United States
1. Yes, you will be considered full time student. Here is the info:
"To qualify as a student, your child must be, during some part of each of any 5 calendar months of the year:
*A full-time student at a school that has a regular teaching staff, course of study, and a regularly enrolled student body at the school, or
*A student taking a full-time, on-farm training course given by a school described in (1), or by a state, county, or local government agency."
The 5 calendar months do not have to be consecutive.
2. If someone can claim you a dependent, then you can't claim your personal exemption. But your parents can claim you dependent only if these conditions are also met:
*The child must have lived with you for more than half of the year.
*The child must not have provided more than half of his or her own support for the year.
*If the child meets the rules to be a qualifying child of more than one person, you must be the person entitled to claim the child as a qualifying child.
You should read
IRS Publication 17: Your Federal Income Tax; Chapter 3--Exemption for Dependents (as Qualifying Child)
www.irs.gov
2007-12-14 18:34:42 · answer #1 · answered by MukatA 6 · 0⤊ 0⤋
If she's under 24 and was a full-time student for at least 5 full months and provided less than half of her total support for the year then she might still be your dependent for 2007. Since she finished up school in May she may not meet the 5 month test for full-time student status. That would bar your dependency claim. She would also need to live in your household for more than half of the year. Although temporary absences for school count as time at home, once she finished school she'd no longer be living in your home as far as the tax laws are concerned. If she didn't return home immediately upon completion of her studies that would also bar the claim under the residency rule. On the support issue, how much of her total support for the year that she provided for herself is what matters. The fact that you paid more than half of her support while she was in school is only part of the total picture for the year. That test may or may not be met but the 5 month rule or the 6 month residency rule above may be killers in this case so that would make the support issue irrelevant.
2016-05-24 00:17:01 · answer #2 · answered by ? 3 · 0⤊ 0⤋
It is a common misconception that those who are in school for at least 5 months can automatically be claimed by their parents. That is incorrect, and you would still have to be a qualifying child or qualifying relative in order to be their dependent.
To be a QC you would need to live with your parents for more than half the year, and you cannot have provided over half your own support. If you meet those tests (in addition to the details you gave in your message) you would not be able to claim yourself.
If you are not a QC, you cannot be claimed by your parents as you would not meet the gross income test to be a QR. In that case you would take your own exemption.
2007-12-14 13:59:02 · answer #3 · answered by taxreff 7 · 2⤊ 0⤋
It's not a matter of "giving" them the exemption - either they are entitled to it or they aren't.
The deciding factor will be how much of your own support you provide. If you provide over half for the year, then you claim yourself. If you don't provide over half, then your parents can still claim you, in which case even if they didn't claim you, you couldn't legally claim yourself. There is a chart for calculating support in chapter 3 of publication 17 - download that at irs.gov and do the calculations.
2007-12-14 18:49:23 · answer #4 · answered by Judy 7 · 0⤊ 0⤋
You should talk to your parents about this. If they claim you as a dependent, they pay less taxes and you pay more. If you are independent, you pay less and they pay more.
I think the definition of dependent is that they pay for at least 50% of your living expenses. So if they have been paying for your rent or providing you their house to live in, and paying for your tuition, you are dependent. If you have been living off of student loans and they haven't contributed much to paying down the loans, you are independent.
2007-12-14 12:29:14 · answer #5 · answered by jellybeanchick 7 · 1⤊ 2⤋
How do you guys do your taxes? CPA? Turbo Tax? I would run the numbers both ways and see. I don't think you will have to pay income taxes since in 2008 you will have made like $13,000 for the year.
2007-12-14 13:03:57 · answer #6 · answered by Dom 5 · 0⤊ 4⤋