How to determine the right time to file your tax return independently
It’s tax season again and figuring out whether to file independently from your parents can be a hard question to answer if it is the first time you’re doing them on your own. In the end it all comes down to your financial and living situation, but where exactly is the line drawn?
Here are some indicators to help you answer whether you are ready to file independently from your parents in the eyes of the government.
Age. Though it is common for people to be considered “old beyond their years” the IRS doesn’t pay much regard for someone’s spiritual age. Rather, if you are under 24 years old, your parents have the option to define you as dependent when filing their own taxes. Once you are over 24, you are officially considered “on your own.” Though there are some exceptions regarding those with disabilities who may require extra care beyond the age of 24.
2. Parental support. Your parents can support you in many ways - financially, emotionally, and mentally, or you may consider yourself a capable adult. But when filing your taxes you need to look at the pure fiscal aide that your parents are providing you. If they financially provide you funds that are equal to or greater than half of your annual income, then you must file as dependent.
3. Living situation. If you lived with your parents for more than half a year, then you are considered dependent. Being a student can make it hard to define how long you lived at home if you’ve recently moved into an apartment or campus dorms.
Defining your dependency, or independency, come tax time has a very large financial effect on your returns for that year. You should NOT file as dependent because you wish to be deemed as such, or because you think your return will be larger by doing so. Ultimately your return will be rejected by the IRS or state and it will mean more paperwork for you in the end. It’s more important to file your taxes correctly the first time and avoid the flag by the IRS.
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