Taxes: Dependent or Independent?

<p>On my FAFSA I'm classified as a dependent. </p>

<p>My Mom and I are working on completing our income taxes now since we previously submitted only estimates and were chosen for 'verification'.</p>

<p>My Mom has always in the past marked my sister and I as dependents on her income tax return. However she gets no tax breaks from doing this since all of her income is tax exempt anyway. Technically she's not even required to file. </p>

<p>On the other hand, I made around 3K in 2011. I'm not required to file either, but I do normally file a 1040EZ since I will only end up getting a refund and not paying anything extra in.</p>

<p>MY QUESTION IS: For purpose of maximizing federal financial aid received should I mark myself as an independent on my income tax forms or let my mom mark me down as a dependent? THANKS!</p>

<p>Whether your mother claims you as a dependent has no effect on financial aid for college. For purposes of college tuition, you’ll be considered dependent on your parent(s) until one of the following things happens:</p>

<p>a court declares you an emancipated minor, or
you get married or have a child of your own (NOTE: I am not recommending this), or
you serve in the armed forces, or
you complete a bachelor’s degree and apply for graduate or professional school, or
you turn 24.</p>

<p>“Dependent for the purposes of tuition” has no real connection to “dependent for tax purposes.”</p>

<p>Thanks for the quick reply Sikorsky! According to your information it sounds like we might as well flip a coin to decide who puts what on our tax docs.</p>

<p>FAFSA dependency is completely different from dependency for tax purposes. FAFSA does not care whether you are claimed as a dependent on a tax return or not but bases your status on a series of questions (age, marital status etc). Filing taxes as independent would not make you eligible for more aid. </p>

<p>Also, if your Mom and you paid any qualified educational expenses, she may still benefit from claiming you as a dependent. The American Opportunity Tax credit is a partially refundable credit (meaning you can get money even if you paid no taxes). The refundable part of the credit is difficult for a student under 24 to be eligible for, but the parent may be eligible for it if they claim the student as a dependent.</p>

<p>Hi swimcatsmom! Interesting info on the American Opportunity Tax Credit. I may be eligible if my Mom makes a contribution to my tuition, etc.? Is she still eligible even though her income is tax exempt? Thanks!</p>

<p>Yes she is. Have her file a return and get the refundable portion back. She is eligible for this if she claims you as a dependent and she doesn’t even need to contribute to college costs as long as they are either covered by you or loans.</p>

<p>A student under 24 however, can’t claim the refundable part unles he or she provides more than half of their own support from earned income. Since you made only about $3,000 you would not qualify.</p>