I am a full time student who made $10,542 last year. Can my parents file taxes for me?

Asked by Yuli

2 Answers

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Answered by Cynthia Williamson, CPA in Overland Park, KS
Hi Yuli. As a student you are probably used to taking tests. In this particular situation, there are some tests (detailed later) that, should you pass, could qualify your parents to claim you as a dependent on their 1040 tax return. Before going further, it's important to clarify some terminology.

In your question you ask "Can my parents file taxes for me?". The question is really "Can my parents claim me as a dependent on their tax return?". Please know that if your parents do qualify to claim you as a dependent, you should still file your own tax return. You didn't mention it, but presumably you've had taxes withheld from your earned income of $10,452. The only way to obtain a refund (or pay the tax due on that income) is for you to file your own tax return. If your parents claim you as a dependent on their return, you cannot claim your personal exemption on your own tax return. This means that box 6a of your 1040 form should remain unchecked.

In essence, there is no 'double dipping'. Having your parents claim you as a dependent is providing them the tax benefit of reducing their taxable income by $4,000, rather than you obtaining the tax benefit of reducing your income by $4,000. Generally speaking, from an overall tax liability perspective, it will be more advantageous for your parents, as they are presumably earning more and in a higher income tax bracket.

Now, for those tests I mentioned earlier. You must be able to answer YES to all of the following before your parents could claim you as a dependent on their tax return:

Test 1: Are you a full time student and under the age of 24 as of 12/31/15?
Test 2: Did your parents provide more than half of your support in 2015?
Test 3: You are not filing a joint return for 2015, unless you are only claiming a refund of withheld income?
Test 4: Did you live with your parents in the same home for more than half of 2015? (Time at school counts as time lived with your parents.)

The advantage of claiming you as a dependent is that your parents could then obtain the following tax benefits:

Tax Benefit 1) Claiming you as a dependent will reduce your parent's taxable income by $4,000. (Not the income tax owed or due, but the total income upon which they are taxed.)
Tax Benefit 2) Depending on whether you are enrolled in an eligible institution, and the amount of your parent's gross income, they may potentially claim the the Education Credit. If your parents claim you as a dependent, you cannot claim the Education Credit (line 50 on Form 1040) on your own return.

For more information on the Education Credit - refer to Form 8863 on www.irs.gov, as this is an entirely different question, but does come into play here. | 03.07.16 @ 18:29
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$commenter.renderDisplayableName() — {comment} | 12.06.16 @ 22:15
Answered by Tae Lee, Insurance Agent in Bellevue, WA
That all depends on your parent's income. If they are high income earners then it may be better that you file the tax for yourself. But if their income is low then it may be is oK that they file it with their income.

But my recommendation is that you file it yourself if you are a college student. But if you are a high school student, they it has to be filed by your parents.

If you have more questions, please let me know. | 03.09.16 @ 20:06
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$commenter.renderDisplayableName() — {comment} | 12.06.16 @ 22:15
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Answered by

Cynthia Williamson
Cynthia Williamson, CPA in Overland Park, KS

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