<p>My H does the taxes, so I have not looked the form over closely, but did notice that on the front page of the 1040, it says for dependents.. children under 17. S just turned 17 in April and we are still fully financially and in all other ways, supporting him. Will we be able to claim him as an IRS dependent? How? And if so, for how long? A friend of mine claimed her 18 year old and told him to not claim himself on taxes as she got more benefit than he would have (and she paid him what he would have gotten from IRS).</p>
<p>As I understand it, in regards to FAFSA a child is a dependent until age 24 (with some exceptions, but not the general rule). </p>
<p>Can a child remain a "dependent" (on IRS) when not living at home (for example.. at college)?</p>
<p>I'm not clarifying my question(s) well at all, but wondering how to make sense of "dependency" for tax purposes first.. as I understand the issue with the FAFSA. </p>
<p>How can we best financially benefit with IRS and FAFSA in regards to dependency?</p>
<p>Refer to the IRS website for information about continuing to claim your son. [Internal</a> Revenue Service](<a href=“http://www.irs.gov%5DInternal”>http://www.irs.gov). You can easily find out all the necessary information.</p>
<p>Financial aid dependency status is completely separate from IRS dependency status. If the student cannot answer yes to any of the dependency status questions on the FAFSA, he is dependent for financial aid purposes. It doesn’t matter whether or not his parents can or do claim him as a dependent for tax purposes.</p>
<p>Basically you can claim a kid who does not turn 24 that tax year and is under that age and has been a full time student for at least 5 months of the year. Otherwise the age limit is 18 and/or other stipulations. </p>
<p>That meshes with financial aid. But the two are not always together in definitions. For instance, who claims whom for tax purposes is not necessarily the custodial parent. You gotta go through the rules on each form very carefully and not assume that what is so on one form works the same way on the other.</p>
<p>So, do you just put the child’s information on the 1040 as a dependent, even though they are 17 (not 18)? Off to the IRS website… try to hunt it up.</p>
<p>Why would you think your 17 year old would NOT be your dependent for tax purposes? Nearly all 17 year olds are. It would be an exception if he were not.</p>
<p>If the child is under 24, a full time student, and does not provide more than 50% of his/her own financial support, then you can claim him/her as a dependent on your taxes. (scholarships do not count as part of providing their own support).</p>
<p>For FAFSA the student is usually a dependent if they are under 24 (and are not a veteran, have a dependent of their own etc etc). Being claimed or not as a dependent on taxes has no impact on determining whether a student is a dependent on FAFSA.</p>
<p>Claiming a dependent under 17 only means that, assuming you meet the income qualifications, that you can take an additional child tax credit for them. Once they reach 17 you no longer get that credit but you can still claim them until they turn 19. Once they turn 19, they have to meet the income limitations (which is the amount of the personal exemption) or be full time students and then you can claim them until they are 24.</p>
<p>@ 3bm … yes, thank you for understanding what I was asking (it was my ignorance that didn’t make my question more clear). OK… so we can no longer get the child tax credit ? That’s gonna hurt!</p>
<p>I’ve never understood why the tax credit ends in the year they turn 17 rather than 18 (as most kids are in school till they are 18). But then there is a lot I don’t understand about government decisions. :rolleyes:</p>
<p>So, since my child turned 17 this year (2011), will we be able to claim the tax credit for 2011 taxes?</p>
<p>Also, since I don’t do the taxes, I guess I didn’t realize that the issue was not “dependent”, but was the tax credit. So there really isn’t a relationship between the two?</p>
<p>What tax benefit is there in claiming a dependent, if not a tax credit??? </p>
<p>So let us say your income is $40,000 and there 4 members in the family (the filer plus 3 dependents). In 2011 you can reduce your taxable income by $3700 for each dependent and the filer. For example, you can reduce taxable income from $40,000 to ($40,000 -3700<em>4)= $25,200. Then are other deductions etc. but let us assume you pay taxes on $25200 at 10% and hence pay $2520 in taxes. This $3700</em>4 is like a tax deduction i.e. you deduct the amount from the gross income to get the net taxable income. You pay taxes on the net taxable income. If you did not not have the tax deduction (personal exemption) you would have paid $4,000 but saved $1480 which is 10% of the deduction amount.</p>
<p>Now let us say you get a tax credit. Tax credit reduces the tax dollar for dollar. So let us say you get a child tax credit of $500 in addition to the deduction. Here you have to pay $2520 in taxes but you can reduce your tax burden by $500, which is $2020.</p>
<p>In other words, when your child is 17 or less, you get to take a tax deduction (also called personal exemption for him) and a child tax credit. Now you will only get the personal exemption till he is 18. Beyond that he needs to be full time student or disabled etc. for you to get it. In other words, claiming him as dependent will reduce your tax burden by your tax rate times $3700 (in 2010 it was $3650)</p>
<p>This is very simplistic and there could be other factors like AMT, standard or itemized deductions, etc. There is also a phaseout of the dependent exemptions but that is for high income filers.</p>