Deciphering the Difference between Dependent and Independent
My taxes last year seemed easy at first. I was working on campus, not really doing a lot on the side. I’d never done them on my own, usually my mom did them, but she was ill last year and so I learned how to do them myself. Not a bad deal, right?
My return got… well, it got returned. “There are mistakes on your tax return,” the email said. “Crap!” I thought, “What in the world did I do wrong? I had to put things into like 15 boxes, and I copied them right off of my W-2’s.”
I called my stepdad for help. “Alright, what in the world did I do wrong?” I explained everything I had done on the forms. He stopped me in the middle of our conversation.
“You filed yourself as independent?” He swore after that. “I filed you under your mother.”
I groaned. Thankfully, I just had to switch my filing status to dependent for that year. I could have had them file a correction, but the extra money I would have gotten from my return wasn’t worth it the extra amounts of time and paperwork on all of our parts; my stepdad just handed me the difference (like $100- big money, right?) and we went forward.
Please don’t let this happen to you. When you get out of college, there are a few things you need to know when filing your taxes.
What determines whether you’re a dependent or independent?
- Dependents have half of their living expenses paid by the person they’re a dependent of. I was teeter-tottering on the edge here, but it was enough to make the case without being fraudulent.
- You are 24 or younger (I was 25 when I filed, but 24 for that tax year).
- You are disabled.
- You are a parent being cared for by a child.
There are other reasons that you could be dependant as well, but those are to be determined between yourself and your tax preparer and/or professional. These are just the most common/most used reasons when you’re trying to figure that stuff out.
Why does it matter? Well, like I said earlier, if you file as independent, you usually get more back on your return, especially if you are not making a lot per year (like I was when I was still a student). Also, if you do file as dependent and you aren’t, it could be considered fraudulent, thus potentially landing you with some big fines that aren’t worth the extra money that your parents may get because of you.
Now, I certainly don’t qualify as a dependent under any of those restrictions anymore. I filed independent this year, and yes, I checked with my stepdad that he didn’t accidentally put me as a dependent again. So, we were clear, and I hope you are too!
