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If I, the student claim education tax credit, can my parents still claim me as a dependent?

Forum|Forum|6 years ago
June 5, 2019
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They paid for some of my education expenses and student loans

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Best answer by Hal_Al

No.

But you've got the cart before the horse. If your parents can claim you as a dependent, you are not allowed to claim the education credit**.

Furthermore, there is a rule that says IF somebody else CAN claim YOU as a dependent, You are not allowed to claim your own exemption. If you can't claim yourself, you also cannot claim the tuition credit**. If you have sufficient income (usually more than $6300), you can & should still file taxes, you just don’t get your own $4000 exemption (deduction). In TurboTax, you indicate that somebody else can claim you as a dependent.

A child of a taxpayer can still be a “Qualifying Child” (QC) dependent, regardless of his/her income, if:

1. He is under age 19, or under 24 if a full time student for at least 5 months of the year, or is totally & permanently disabled

2. He did not provide more than 1/2 his own support

3. He lived with the parent (including temporary absences such as away at school) for more than half the year

There's a new urban myth among college students that says they can get a $1000 from the government just for filing a tax form. For most of them, they simply aren't eligible. A student, under age 24, is only eligible for the refundable portion of the American Opportunity Credit if he supports himself by working (earned income). You cannot be supporting yourself on parental support, 529 plans or student loans & grants. You must have actually paid tuition, not had it paid by scholarships & grants. It is usually best if the parent claims that credit.

**While technically there is a provision that allows you to claim a tuition credit, from a practical matter it seldom works out. A student, under age 24, can only claim the non-refundable portion of the credit. For this to work, the student would have to have a tax liability to take the credit against. If the student actually has a tax liability she can claim a non-refundable credit but then the parent must forgo claiming the student's exemption and the student still can’t claim his exemption.

Hal_AlAnswer

Employee

No.

But you've got the cart before the horse. If your parents can claim you as a dependent, you are not allowed to claim the education credit**.

Furthermore, there is a rule that says IF somebody else CAN claim YOU as a dependent, You are not allowed to claim your own exemption. If you can't claim yourself, you also cannot claim the tuition credit**. If you have sufficient income (usually more than $6300), you can & should still file taxes, you just don’t get your own $4000 exemption (deduction). In TurboTax, you indicate that somebody else can claim you as a dependent.

A child of a taxpayer can still be a “Qualifying Child” (QC) dependent, regardless of his/her income, if:

1. He is under age 19, or under 24 if a full time student for at least 5 months of the year, or is totally & permanently disabled

2. He did not provide more than 1/2 his own support

3. He lived with the parent (including temporary absences such as away at school) for more than half the year

There's a new urban myth among college students that says they can get a $1000 from the government just for filing a tax form. For most of them, they simply aren't eligible. A student, under age 24, is only eligible for the refundable portion of the American Opportunity Credit if he supports himself by working (earned income). You cannot be supporting yourself on parental support, 529 plans or student loans & grants. You must have actually paid tuition, not had it paid by scholarships & grants. It is usually best if the parent claims that credit.

**While technically there is a provision that allows you to claim a tuition credit, from a practical matter it seldom works out. A student, under age 24, can only claim the non-refundable portion of the credit. For this to work, the student would have to have a tax liability to take the credit against. If the student actually has a tax liability she can claim a non-refundable credit but then the parent must forgo claiming the student's exemption and the student still can’t claim his exemption.

S

sfalumberjack192

This seems incorrect. 26 CFR 1.25A-1(f)(2) Example 2 seems to indicate that a parent can optionally choose to not claim a dependency exemption for their child. They are entitled to, but not required to. If they forego that deduction then the student can claim the educational credit and get the $1,000 refundable AOTC. The child may not be able to claim themselves on their return, so the child may not be claimed on any return. It will be interesting to see what happens in 2018 and later with the elimination of the personal exemptions.