Will claiming a child on taxes hurt there chances of getting govt funding for college?

Question

I live in Iowa and have my much younger sister in my care, i was told not to claim her on my taxes (she is a junior in high school) these last 2 years of college because it will hurt her chances of getting funds from the gov't for college, our household is about $97k a year. Any advice would be nice...

Answer 1

Ok, there could be alot to cover, so be patient:

First off, why is your sister in your care?  Are your parent's deceased?  Was she adopted?  Do you have guardianship?

Secondly, You claiming her on taxes will not affect her financial aid.  When you fill out your FAFSA, however, you should be filing that you have a dependent who receives more than half their support from you.

Review this site, and perhaps you can apply your own personal circumstance instead of having to post more details on the web...

1. Eligibility - http://www.fafsa.ed.gov/faq003.htm

2. Programs Available - http://www.fafsa.ed.gov/what010.htm

3. How EFC will be determined - http://www.fafsa.ed.gov/faq010.htm#faq01...

4. Determining Dependency Status - http://www.fafsa.ed.gov/FOTWWebApp/fotw0...

You will notice, that throughout any of the requirements for eligiblity or determination, does it matter who claimed you (her) on taxes.  

I hope this helps

Answer 2

no

Answer 3

If you claim her she will not get gov't funds. you are in a higher tax bracket which disables you from recieving them.

Answer 4

Who claims who on what tax form makes absolutely no difference on applying for federal fin aid.  Not claiming her would just rob YOU of the lower tax bracket.  

Also be aware that she will be required to list her parents info on her fafsa application (unless you have legally adopted her... and NO other reason... legal guardianship doesn't count).  Another reason she wouldn't have to list folks income is if they are both deceased or if she is a ward of the court, then in that case she would not need any adult on her fafsa info.  (See Jeremy's post re: Dependency)

Answer 5

I don't believe it will hurt her in any way for college. Also keep in mind that she can be claimed as a dependent by any adult family member that has been living under the same roof for more the 6 months. So you might as well make her a dependent of the person with the largest income so you can benefit and get a little extra back on your tax refund.

Answer 6

it will not hurt your chances

Answer 7

She will not be able to claim herself as an independent for Federal financial aid purposes unitl she is 24. If she is already 24, then do not claim her. If she is under 24, it will not make a difference, so go ahead and claim her.

Answer 8

Typically speaking, I'd say no. Claiming a child can only help you since children are considered dependents. IN other words, children rely on you for financial support. So it's your duty to provide for them, which could possibly take away from you, money you'd normally use for schooling. But normally the more dependents you have, the better your chances at receiving financial aid.

Answer 9

Talk to the financial aid departments at state schools in Iowa. They will be more familiar with the FAFSA requirements and qualifications for grants and federal aid your sister may qualify for. They are also familiar with the different ramifications and benefits of claiming dependants on taxes.