Question

Unsure if I can claim son will full ride scholarshp?

Forum|Forum|6 years ago
February 16, 2020
1 reply
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I'm trying to figure out if I can claim my son as a dependent or not. He got a full ride 4-year scholarship where both his tuition and room/board are completely paid for. He started college in Fall 2018 so 2019 was his first full year as a college student. When he wasn't on campus he did live back at home during holidays and a bit during the summer. However, he also got a summer internship out of state and he paid for his own living expenses there by way of his internship pay as well as additional funding he got as part of his scholarship.

BUT, we took money out of his 529 (which we funded of course) to allow him to buy a car. I believe that counts as support? From what I read, that is allowable to do without penalty if a student gets a full ride, but taxes need to be paid on it.

So, can I claim him as a dependent counting the support given to him by virtue of the car (transportation) as well as periodic living expenses when he came home?

Also, it seems he has to pay taxes on the room and board portion of his scholarship (but not tuition), right?

B

Bsch4477

Employee

Scholarship funds do not count toward the support calculation.

Yes, scholarship used for anything but qualified education expenses is taxed.

T

tettnangerAuthor

Thank you for the reply. What about if his room and board expenses are paid for by the scholarship? Does that count for him supporting himself and against us supporting him? Or is it not relevant?

And if room and board being paid for by scholarship does not count towards support either way, what if he supported himself over the summer for rent, food, etc (internship pay) but we funded $16K towards a car via 529 distribution. Would whatever is greater out of that amount determine whether he's a dependent or not?

B

Bsch4477

Employee

Use this worksheet

https://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf

Do not count the scholarship income when you calculate support. So do not include his room and board as being paid by him if scholarship money was used.