The Internal Revenue Service allows you to reduce the amount of your taxable income based on the number of exemptions you claim. You can claim one exemption for yourself, one for your spouse, and one for each of your dependents. If you've claimed an exemption for your child for the past 18 years, but this year she turned 19 and you're wondering if you can still hang on to that tax break, the answer is: maybe. Whether your 18 year old's tax return is separate or with yours, there may be some tax breaks.
TL;DR (Too Long; Didn't Read)
You can claim a college-age dependent until that child reaches the age of 23 as long as he meets the IRS's requirements.
Claiming a College-Age Dependent
The IRS allows you to claim an exemption for your child who is under 19 years of age. You might be able to continue claiming an exemption for your college-age child from age 19 through 23 years old, provided she meets the IRS' other tests as a qualifying child. Your college-age child can work and earn income, and you can still claim an exemption for her as a dependent, as long as she does not provide more than half of her financial support for the entire year. If you claim an exemption for your college-age child, she cannot claim an exemption for herself.
Child Dependent Exceptions
The IRS requires you and your college-age child to have the same principal residence for more than half of the tax year. The IRS considers periods of temporary absence for the purpose of attending school, military service, vacation or business to be time when the child lived at your principal residence. If you're considering claiming a child on taxes that is not yours, the IRS has specific parameters for who qualifies as your child. A qualifying child can be your natural child, a step-child, adopted child, foster child or grandchild. A qualifying child can be your sibling, half-sibling, step-sibling, niece or nephew, but must be younger than either yourself or your spouse.
Even if your child meets all of the other tests, you cannot claim an exemption for her unless she was a full-time student for at least five months out of the year. The five months do not have to be consecutive. You cannot claim an exemption for her in the year she turns 24 years of age. There is one exception to the full-time-student rule for college-age children. You can claim an exemption for your child, regardless of age or status as a full-time student, if she was permanently and totally disabled at any time during the year.
2018 Taxes and Education
The new tax laws haven't changed anything related to claiming college student on a parent's tax return. However, the Tax Cuts and Jobs Act did change one thing related to filing. Although it did retain most of the education credits your college student can claim, it eliminated the credit for unreimbursed employer expenses. So if your college-age student is taking classes on the side while working a full-time job, you'll need to pay close attention to the law to make sure education expenses are covered.
2017 Tuition and Fees Deduction
The tuition and fees deduction expired at the end of 2016 but was extended through the 2017 tax year. This deduction allows you to claim qualifying college expenses for yourself or a dependent. This credit was not extended to the 2018 tax year.
Mike Parker is a full-time writer, publisher and independent businessman. His background includes a career as an investments broker with such NYSE member firms as Edward Jones & Company, AG Edwards & Sons and Dean Witter. He helped launch DiscoverCard as one of the company's first merchant sales reps.