The Money Mustache Community
Learning, Sharing, and Teaching => Taxes => Topic started by: dundee on November 15, 2017, 02:36:36 PM
-
Dear mustachians, hopefully this is a simple question.
My daughter graduated from college in 2017 and started full time work. She was dependent on us for ~6 months while she was working odd jobs. Since July, she has been employed full time and is not dependent on us. I estimate her total income this year to be around $40k. She is over 21.
In the past years, I filed taxes and claimed her as my dependent. She also filed separately based on her W2 income. But noted that she is a dependent.
I want to understand what is the correct way to file the taxes for both of us in February 2018.
1. I file my taxes. But, do not include her in any way?
2. She files taxes as a single filer? like 1040EZ may be?
Or is there a different way of filing taxes since she was part year dependent on me?
thank you.
-
I think you need to figure out how long you supported her better than ~6 months. You can claim her as a dependent if you provided more than half of her support. Either way, she needs to file her own taxes, and free TurboTax would probably be her best bet.
-
According to TurboTax:
The 5 tests that will qualify a child as a dependent are:
Relationship: Must be your child, adopted child, foster-child, brother or sister, or a descendant of one of these (grand or nephew).
Residence: Must have the same residence for more than half the year.
Age: Must be under age 19 or under 24 and a full-time student for at least 5 months. They can be any age if they are totally and permanently disabled.
Support: Must not have provided more than half of their own support during the year.
Joint Support: The child cannot file a joint return for the year.
-
See http://docs.cotaxaide.org/Qualifying%20Child%20or%20Relative%20Flowchart.pdf and https://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf for some insight. The second link assumes someone lived in your household all year, so you would have to do two calculations for the "Expenses for Entire Household (where the person you supported lived)" section:
1) when she "lived with" you (even if at school)
2) when she lived alone after graduation
and add them.
-
Here is an infographic which may help.
https://www.1040.com/assets/PDF/Dependents-TY16.pdf (https://www.1040.com/assets/PDF/Dependents-TY16.pdf)
-
I was in the same situation last year. I couldn't claim my daughters as dependents because they made too much money for the calendar year after they both graduated.