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Yes, it is bases on 40% of total credit. If the student is eligible for the refundable part of the credit (difficult as they must have *earned *income that provided 50% of their own support) and they have $4000 in qualified expenses then they can get the full $1000 of the refundable credit. If the qualified expenses are less than $4000 then the refundable credit is 40% of the amount they total credit they are eligible for.</p>
<p>The earned income for their support was an unexpected spanner in the works when the rules came out last year. I thought my daughter, who does provide much of her own support but not 50% from earned income, was going to be able to get a nice credit last year. I was bummed when I saw that rule!!</p>
<p>Along the same lines of this thread, I have a question. Thinking of amending 2008 and 2009 returns and removing DD (in college since fall 2008) as a dependent. She will file her own return and use the 1098T and Lifetime Learning Credit (our income is above the limit so we can’t use it )This will change her tax liability to zero as opposed to owing $$. And this generates a refund for us on the amended returns since she had been “kiddie” tax based on our income.</p>
<p>My question is in regards to the health care eligibilty and for those previous years. Starting in Jan. 2011, with the new health care reform, tax dependency is not a factor in eligibilty for health care. HOWEVER, from digging in old files, our health care benefits eligibilty for 2010 states it is consistent with definition of dependent by IRS code. (can’t find previous year’s forms)</p>
<p>Would amending 2008 and 2009 returns trigger something from the IRS to our health care insurance company? What are the implications? Repayment of benefits received? Any experience, suggestions or advice is greatly appreciated.</p>