I turned 18 this past March and since June I’ve been paying 400 dollars in rent. I work full time and cover my car insurance, medical, phone, and more. I also barely eat their food. My dad still says I can’t claim myself on my taxes, and I’ve owed taxes in the past. I’m not asking if it’s fair or not, but I’m curious about what I’m actually losing by having my dad claim me every year. Thanks!
Owing taxes is usually about not withholding enough, not just being claimed as a dependent. Try adjusting your W-4 if you keep owing each year.
Your tax situation likely stays the same whether or not you’re claimed as a dependent. Check the support test and other criteria for qualifying child in the Form 1040 instructions.
What do your parents pay for mortgage or rent and utilities each month? If the three of you live there and those costs are over 1200, then your 400 might not cover your support.
Kai said:
What do your parents pay for mortgage or rent and utilities each month? If the three of you live there and those costs are over 1200, then your 400 might not cover your support.
So is it just based on what I contribute to rent or mortgage? I thought it included the total living costs.
You’re not missing out on anything under the tax laws since 2018. Exemptions are gone unless you’re a college student. They only get a $500 credit for other dependents.
Voss said:
You’re not missing out on anything under the tax laws since 2018. Exemptions are gone unless you’re a college student. They only get a $500 credit for other dependents.
Not all states have dropped exemptions like the federal government did.
Voss said:
You’re not missing out on anything under the tax laws since 2018. Exemptions are gone unless you’re a college student. They only get a $500 credit for other dependents.
They lose the standard deduction if you’re claimed as a dependent. It’s limited in that case.
@Dallas
It applies to all earned income plus $400. If you have over $400 in investment income, you may owe a little more. But it won’t change your refund by more than $100.
Voss said:
You’re not missing out on anything under the tax laws since 2018. Exemptions are gone unless you’re a college student. They only get a $500 credit for other dependents.
Thanks, this really helped!
For 2024, the standard deduction for someone claimed as a dependent is $1,300 or your earned income plus $450, whichever is higher (but it can’t exceed the basic standard deduction for your filing status). It all depends on your earned income amount and what you’re missing out on with the standard deduction and possible credits like the Earned Income Tax Credit.
It depends on your earned income amount how much you are missing out on with the standard deduction.
It actually depends on unearned income. The federal standard deduction is pretty much the same for non-dependents as long as your income is earned.
Possible credits like the Earned Income Tax Credit.
Remember, you can’t claim the federal EITC if you’re under 25 and don’t have a dependent. But state-level tax benefits are worth looking into.
@Kai
Single people can also claim the EITC, just not as much as those with dependents. As long as they meet the AGI range and other requirements, they should be okay for EIC.
- Calculate your tax and see how much you’d get back.
- Ask your parents to do the same with and without you as a dependent. Your income matters too. I doubt they would benefit much by claiming you.
- Then decide based on what you find out. It won’t cost anything until everyone files, so no one loses anything.
- If your part is way more than they’d get, maybe offer them some money to keep the peace.
- I never told my adult child they couldn’t when they lived with me. It’s strange to me, but everyone has their own way, I guess.
Tell your parents to do the same with and without you as a dependent. Your income needs to be reported as well. I really doubt they would get much more with you on it.
Dependents’ income can only be counted on the parents’ return if it’s solely investment income. A dependent’s earned income never gets included on the parents’ return.
I get it … if you’re paying for over 50% of your living costs, you could be considered independent. If you’re making enough, you might want to claim yourself. But if your parents still claim you, the IRS might audit both sides. Just know, it might not really change anything if you’re not in school.
I had a similar issue with my parents when I was in college. I ended up amending my tax return and lost around $2000 because of it … super annoying but whatever.
I’m surprised how many think it’s about who benefits. That’s not how tax law works legally.
Maybe it’s time to think about moving out. You’re becoming independent. Then you could always move back in once you know how much it really costs to support yourself.
@Fifer
I know how much it costs. I’ve calculated it many times and I cover around 90 percent of my living expenses. I didn’t ask this from a place of entitlement. I’m confused why I’ve received comments like yours, which feel passive-aggressive. I asked a financial question, not an ethical one. I plan to move out within the next year when I turn 19, in my first investment property.