Tax Shop
Tax Shop
Charles Trautman, EA · Since 1969
Topics · Families

Who Should Claim the Child?

A $6,000 summer job, a teenager trying to do the right thing, one checkbox left blank — and your return rejected by the IRS. Half a dozen families call us with this every spring. Here is what happened, what it costs, and how we put it right for you.

What happens every year

Your son or daughter worked over the summer, earned about $6,000, and got a W-2 in January. Being responsible, they sat down with a free tax program, filed their own return, and collected a refund from the IRS and from Colorado. They were proud of themselves. They should be.

Then you went to file your return in March, claimed them as you always have, and your e-file came back rejected: a dependent on this return has already been claimed on another return.

Nobody did anything wrong on purpose. The tax program asked one question your teenager didn’t understand — “Can someone claim you as a dependent?” — and they answered no, because nobody had claimed them yet. That one answer is the whole problem. It is also the point at which the phone rings here.

The box that matters

The question on the return is not whether someone is claiming you. It is whether someone can. If a child meets the tests to be a parent’s dependent — under 19, or under 24 and a full-time student, living at home more than half the year, and not paying more than half of their own support — that box must be checked, whether or not the parent ends up claiming them. A sixteen-year-old with a summer job almost never pays half their own support. The box gets checked.

Here is the part that surprises parents: checking the box usually costs the child nothing. There is no longer a personal exemption to “claim yourself” with. A dependent with wages still gets a standard deduction equal to their earnings plus $450, up to the full single amount. A child who earned $6,000 has a $6,450 standard deduction, no taxable income, and gets every dollar of withholding back — box checked or not.

So the child gains nothing by leaving the box blank. The parents lose a great deal. That is why the answer to “who should claim the child” is, nearly always, the parents.

What the mistake costs the family

When the child’s return goes in with the box unchecked, the parents cannot claim the child on an e-filed return. Depending on the child’s age, that means giving up:

$2,200
Child Tax Credit for a child under 17 at year end (2025 returns)
$500
Credit for Other Dependents for a child 17 or older
up to $2,500
American Opportunity Credit for a college student’s tuition

It can also affect head-of-household filing status for a single parent, and the Earned Income Credit for lower-income families. Colorado starts its return from your federal taxable income, so whatever goes wrong federally carries straight into the state return.

Figures are for 2025 returns filed in 2026. The Child Tax Credit is $2,200 under the 2025 tax law; credit amounts and income limits change, and some credits phase out at higher incomes.

How we fix it for you

The child’s return is already filed, so it has to be corrected, not ignored. Bring us your documents and a copy of the return your child filed, and we take it from there. Two things happen, and we do them together:

  1. We amend the child’s return. We prepare Form 1040-X checking the box that should have been checked. In most cases nothing else changes and no money goes back — the refund was correct, only the box was wrong. The child signs, we file it.
  2. We prepare your return claiming the child. E-file will keep rejecting it while the duplicate is on record, so your return goes in on paper. You still claim the child, and you still get the credits you were entitled to.

The IRS then matches the two returns and sorts it out. It takes months rather than weeks, and you may get a letter along the way, but it does get resolved. We have been through it many times, we understand how it works, and we are here to help.

The year after, we prepare both returns here, in the right order: yours first, your child’s second, box checked. The problem does not come back.

If your child has not filed yet, call before they do. Ten minutes now saves four months of correspondence with the IRS.

Is there ever a real choice?

For a child who qualifies as a dependent, no. The child must check the box. What the parents can choose is whether to use the dependent on their return, and there are two situations where not claiming the child is worth running the numbers on.

High-income parents with a college student

The American Opportunity Credit disappears for married couples above $180,000 of income ($90,000 single). If the parents can’t use it, the student may be able to claim the non-refundable part against their own tax — but only if they have enough income to owe tax in the first place. A student with real earnings can come out ahead; one with a part-time job usually can’t.

Divorced or separated parents

Here the question is which parent claims, not whether anyone does. The custodial parent has the right to the child, and can release the credit to the other parent year by year with Form 8332. Head-of-household status and the Earned Income Credit stay with the custodial parent regardless. Which arrangement comes out ahead depends on both parents’ incomes, and it is worth comparing before the divorce decree locks it in.

In both cases there is only one way to know: prepare the returns both ways and compare. That is what the worksheet below is for.

The worksheet: who comes out ahead?

Prepare both sets of returns each way — the parents claiming the child, and no one claiming the child. Enter each refund below. If a return shows a balance due instead of a refund, enter it as a negative number. The worksheet adds up what the family keeps under each approach. The example shown is from our files.

Parents claim the child

Child checks the box “someone can claim me”
Parents’ return
Child’s return
Family total$0

No one claims the child

Child still checks the box if they could be claimed
Parents’ return
Child’s return
Family total$0
 
 

The worksheet does the arithmetic; it does not prepare the returns, and it cannot tell you whether a child may legally be claimed — that is a question of the rules above, not of which total is bigger. For divorced parents, use the two columns for “Parent A claims” and “Parent B claims.”

Rejected return? Bring it here.

We straighten out the rejected-return problem every spring, and when there is a real choice about who claims a child, we prepare the returns both ways and show you the difference. Call us before anything else goes in.

303-734-1040

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