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Who can claim dependency exemption?

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in Small Business Tax

Q. My son graduated from college this year. Even though we can claim him as a dependent, we’re going to bypass it so he can claim the exemption for himself. Is this legal? C.S., Plainsboro, N.J.

A. No. The IRS says that a person who can be claimed as a dependent on another taxpayer’s return — such as a parent supporting a child — can’t claim his or her own exemption. That’s true even if the parent doesn’t actually claim the exemption for the child. (A parent is not entitled to claim an exemption for a child who files a joint tax return, however.) Tip: If you choose to forgo the exemption, your child may be able to qualify for an education tax credit, which phases out for high-income taxpayers.

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