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Does my 19 year old College Student actually need to file a return for 2018

Forum|Forum|7 years ago
February 21, 2019
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My 19 year old is a full time university student and has Florida Prepaid, Bright Futures Scholarship and another School scholarship. She has received both a 1098-T and a 1099-Q for 2018. As I was preparing my tax return, Turbo Tax informed me that she would have to file her own return this year even though she will still be listed as a dependent on my return. We worked on her 2018 return together on Turbo Tax and the return is showing a balance due of $131. Her Total Income and AGI are $7,716 and the Standard Deduction $6,402. Taxable Income is $1,314, so Tax Due is $131. None of the income is from work, it is all from the scholarships.

In reading the 1040 Instructions for 2018, Chart B - For Children and Other Dependents, it appears to me that that she actually does not need to file a return.

- Unearned income was over $1,050 = NO

- Earned income was over $12,000 = NO

- Gross income was more than the larger of --- $1,050, or your earned income (up to $11,650) plus $350. = NO

If I am correct that she doesn't need to file, then why does Turbo Tax indicate the $131 as due to the IRS?

Best answer by NCPERSON1

she must file

please read this link:

https://turbotax.intuit.com/tax-tips/irs-tax-return/does-everyone-need-to-file-an-income-tax-return/L7pluHkoW

and specifically the requirements:

All taxpayers who are claimed as a dependent on someone's tax return are subject to different IRS filing requirements, regardless of whether they are children or adults. A tax return is necessary when their earned income is more than their standard deduction. However, the threshold decreases to income greater of $1,050 or the sum of $350 and the person's earned income. A dependent's income is unearned, when it comes form sources such as dividends and interest.

appears the return fails the requirement in red, so that filing is necessary/ The earned income is greater than the standard deduction you state.

N

NCPERSON1Answer

she must file

please read this link:

https://turbotax.intuit.com/tax-tips/irs-tax-return/does-everyone-need-to-file-an-income-tax-return/L7pluHkoW

and specifically the requirements:

All taxpayers who are claimed as a dependent on someone's tax return are subject to different IRS filing requirements, regardless of whether they are children or adults. A tax return is necessary when their earned income is more than their standard deduction. However, the threshold decreases to income greater of $1,050 or the sum of $350 and the person's earned income. A dependent's income is unearned, when it comes form sources such as dividends and interest.

appears the return fails the requirement in red, so that filing is necessary/ The earned income is greater than the standard deduction you state.

IsabellaG

I was working with your numbers, and I am not understanding how her Total Income and AGI are $7716, yet her Standard Deduction is $6402 if you are saying that the entire $7716 is from Scholarship Income. A Standard Deduction of that amount would suggest that your daughter had $6052 in Scholarships (which counts as earned income for the purposes of calculating the Standard Deduction but is considered Unearned Income for the purposes of filing a return).

$6052 + $350 = $6402 Standard Deduction for Dependent.

That would indicate that she had $1664 in interest and dividend income or other unearned income.

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F

fkts99Author

Hello Isabella....thank you for you time. I wasn't detailed enough. These are the figures...$5,602 from 1098-T calculation + $450 Child care work that she did + $1658 from 1099-Q (#2 Earnings), and $6 savings account interest. Based on your reply, I guess that the $5,602 + $450 = $6,052 is considered earned income and that the $1,658 + $6 = $1,664 is considered unearned income. If this is correct, the need to file a return being triggered by the unearned income being over the $1,050.... right? I think the answer is YES. ;)

N

NCPERSON1

as long as the forms are copied verbatim into Turbo Tax and the questions are correctly answered, TT will calculate taxes accurately and correctly - that is why millions purchase their software. :-)