dependent (student) wages/taxes

[dallas702]

What is the name of your state? NV

What is the rule for wage earning dependent students (college) for 2005?

 

[abezon]

They have to take whatever classes their parents want them to take.

 

[Snipes5]

Dallas,

I don't know of any such rule...

Snipes

 

[LdiJ]

What is the name of your state? NV

What is the rule for wage earning dependent students (college) for 2005?

I think that I understand the question that you are asking....so I will give it a stab..

For 2005, a parent may claim a child over 19 and a full time student, as a dependent, as long as the parents combined provide more than 50% of the child's support.

If that doesn't answer your question, then please restate it.

 

[dallas702]

They have to take whatever classes their parents want them to take.

LOL. I wish it were so.

I'm looking for the amount the student needs to make before he/she needs to also file a return, and of course the latest rules about tax credits and whether the parents are still able to claim them (both under and over 18 or 19) as dependents (with over 50% expenses paid).

Every time I get to this information on IRS.gov it comes up in Spanish. I think they are telling us something.

 

[LdiJ]

LOL. I wish it were so.

I'm looking for the amount the student needs to make before he/she needs to also file a return, and of course the latest rules about tax credits and whether the parents are still able to claim them (both under and over 18 or 19) as dependents (with over 50% expenses paid).

Every time I get to this information on IRS.gov it comes up in Spanish. I think they are telling us something.

Ok...I answered part of your question. The other part is that the student should file a return if they made more than 5000.00, or if they made less than 5000.00 but had federal taxes withheld. The rules for education credits haven't changed.

 

[abezon]

The dependent's standard deduction is the larger of $800 OR earned income + $250, not to exceed the single standard deduction ($5000 this year). For most students, it's wages + $250 & no tax is owed, but students with significant investment income can end up owing taxes with income less than $5000.

 

[dallas702]

Thanks.

I'm finally getting the text in English again.

 

[dallas702]

I thought I had this straight until my daughter called to ask me about her filing a return. Here's the deal:

One daughter, age 20, worked last year plus scholarship, but still my dependent though living with her aunt near her college. I'm not sure how much she made (nothing from her employers yet), but I don't think it will be $5000. My contribution to her will be approx. $8000. I want to still claim her as a dependent, but I want her to get a refund of her fed taxes withheld. Do we both file?

Same with 18 year old son, but he earned much less and I contributed much more and he lives at home.

 

[Snipes5]

You both file.

You claim her exemption, she does not. When her return is complete, if she has any tax liability, you write her a check for that amount.

The exemption is of MUCH more benefit to you than to her.

Snipes

 

[LdiJ]

I thought I had this straight until my daughter called to ask me about her filing a return. Here's the deal:

One daughter, age 20, worked last year plus scholarship, but still my dependent though living with her aunt near her college. I'm not sure how much she made (nothing from her employers yet), but I don't think it will be $5000. My contribution to her will be approx. $8000. I want to still claim her as a dependent, but I want her to get a refund of her fed taxes withheld. Do we both file?

Same with 18 year old son, but he earned much less and I contributed much more and he lives at home.

Yes, everybody files. Its simply that your son and daughter file as a dependent of another person.

 

[dallas702]

Thanks. That's what I was thinking, but....

If she files but does not claim her exemption won't she be taxed (federal) on the entire gross amount she made? Then, whether she gets any back or pays more depends on her withholding?

 

[efflandt]

First determine whether any scholarships or student aid are any different if you support her or not. Then figure out the taxes both ways for both of you (with her as a dependent or not). Pick whatever comes out ahead for both of you combined.

Note that anything you give her up to $11000 annually can be considered a gift (or $22000 from you and your spouse).

 

[LdiJ]

Thanks. That's what I was thinking, but....

If she files but does not claim her exemption won't she be taxed (federal) on the entire gross amount she made? Then, whether she gets any back or pays more depends on her withholding?

No, she still gets her standard deduction, which is 5000.00, she just doesn't get her personal exemption. If you think she only made 5k, then the exemption wouldn't do her any good.

 

[dallas702]

First determine whether any scholarships or student aid are any different if you support her or not. Then figure out the taxes both ways for both of you (with her as a dependent or not). Pick whatever comes out ahead for both of you combined.

Note that anything you give her up to $11000 annually can be considered a gift (or $22000 from you and your spouse).

Her scholarship is academic (replaces her soccer scholarship thank God), and is not tied to me or my financial status.

Thanks, LdiJ.

Thanks to all of you.