To claim or not to claim as dependent.....

[jstbcuz]

We are doing our taxes and this year we have a full time college student. Yes we support more than 1/2 of her well being. She has an athletic scholarship that pays books and tuition, a pell grant that pays for her dorm. She only made less than 10K last year.

If we claim her as a dependent we would get 400 more for our federal return which doesnt matter to me, but I wonder if there are benefits to not claiming her as a dependent for her later......such as financial aid, etc.

If we dont claim her on our taxes, will she still be eligible to be covered under our insurance?

So many questions and it is all new to us.........Please shed some light! Thanks!

 

[Darcy03231]

If you claim your daughter as a dependent she cannot claim herself, which can make a difference in her return.

You can still cover your child on your insurance even if you don't claim them as a dependent.

Our DD is in college and works part-time. She made about 12k last year. We found it didn't make any difference if we claimed her or not on our returns. If we claimed her she had to pay on her return. If we didn't claim her she got back almost $2k. Needless to say, she claimed herself.

 

[Cheshire Figment]

I agree that you should work the computations both ways, and do all four returns (yours with or without claiming her, hers with or without your claiming her). What you want is what gives the best results for the family.

I have, in the past, had clients in this situation. If it is most advantageous for you to claim her, it might be nice to make up to her part (or all) of her loss in filing with her not as your dependent.

Mike (CPA Retires)

 

[imsayin]

but I wonder if there are benefits to not claiming her as a dependent for her later......such as financial aid, etc.

In terms of financial aid, she will be looked at as your dependent no matter how she files her taxes (until the age of 24).

 

[herdtoDisney]

I have, in the past, had clients in this situation. If it is most advantageous for you to claim her, it might be nice to make up to her part (or all) of her loss in filing with her not as your dependent.

Mike (CPA Retires)

This is what we do. Our 19 yo DS is a college student and works. We claim him, but I figure his taxes (BEFORE FILING) both with him claiming himself, and with us claiming him. I give him back what he would have gotten if he'd been able to claim himself. He actually spends it all on school anyways so I'd just as soon he has it.