[tegankid]

Ok, I feel like this might be a challenge, I hope someone can answer.
I am an NJ resident where I am a dependent of my single mother. I was an on campus student this spring at an Ohio school, however, I decided to take a semester off and did not return(I made no money there) I wound up becoming employed in Pittsburgh from a virginia based company, I came to PA and stayed with some family friends with little living expenses. I made close to 10k and Pennsylvania took taxes from my paycheck weekly (totaling about 300$). I made my 1st payment towards my federal loan and made less than $100 in interest in New Jersey. I have no idea which state to file in or if I have to do multiple states? I don't know if I'm elligible for educational credits. I'm 19 and totally clueless, please help!
THANK YOU

[AtlantaTaxExpert]

Okay, we need some information about your INTENT! We also need to know how much income your mother made (an estimate will do).

If you made only $10,000, and you claim your own personal exemption, you will get most of your withheld federal income taxes back due to your $5,700 standard deduction and $3,650 personal exemption.

However, because you were a full-time student for five months, your mother CAN claim your personal exemption if she provided more than half of your total support. That is why we need to know how much she made, because that $3,650 personal exemption may be worth MORE to her than it is to you (because her tax rate may be higher).

You probably are eligible for either the Hope or Lifetime Learning Credit for your tuition, but, again, it may be better for your mother to claim these credits due to your low income.

BOTTOM LINE: You NEED to coordinate with your mother BEFORE filing your tax return.

As for the state returns, that is where your INTENT comes in. If you INTEND to stay in Pennsylvania and continue to work and NOT return to school, then, for 2009, you were a part-year resident of NJ and a part-year resident of PA. You pay NJ taxes on any wages earned while in NJ, and pay PA taxes on income earned while in PA. Attach a copy of the OTHER state return to the filed return when you mail it in, to show the each state where you lived and worked the other half of the year. If you earned NOTHING in NJ, then no NJ state tax return is required,

Since no wages were earned while living in Ohio, there is NO requirement to file a Ohio tax return.

Now, if you INTEND to work return to school sometime in 2010, either in Ohio or New Jersey, then you can argue that you were a full-time resident of NJ and a NON-resident of PA. You STILL have to file a PA tax return, but you file as a non-resident. ALL of your 2009 income is taxable by NJ, but NJ will give you a tax credit for the taxes paid to PA.

Any competent tax professional can prepare both state returns for you. So, after you coordinate with Mom and decide whether she is going to claim you as a dependent or not, I STRONGLY recommend you get professional tax help in filing your returns (federal, NJ and PA).

[ebaines]

Since you are over 18 and not a full-time student, you are not a dependent on your mother's return. You must file your own return. You were a resident of NJ up until the summer (whenever it is that you moved to PA - I will assume June), and have been a resident of PA since then. So for taxes you will need to file a return with NJ as a part-year resident from January - June (although it sounds like you won't owe NJ anything), and also with PA as a part-year resident to cover your income from June - December.

[AtlantaTaxExpert]

ebaines:

The OP clearly said that he was a student in an Ohio school for the spring semester, which indicates that he met the criteria of being a full-time student for five months of 2009.

[ebaines]

I thought the child must be a full-time student at the end of the year to qualify as a dependent (per Pub 501)? He wasn't enrolled in the fall, so therefore not considered by the school to be a full time student. Also, the child must have lived with the parent for at least half the year (or been away at school)- it sounds like as of June he was on his own in PA, though we don't really know.

[AtlantaTaxExpert]

While I agree with the uncertainty issue, I offer the below extract from page 29 of IRS Pub 17:

Student defined. To qualify as a student, your child must be, during some part of each of agree any 5 calendar months of the year:

1. A full-time student at a school that has a regular teaching staff, course of study, and a regularly enrolled student body at the school, or

2. A student taking a full-time, on-farm training course given by a school described in (1), or by a state, county, or local government agency.

The 5 calendar months do not have to be consecutive.

Nowhere does it say that the child must be enrolled at the end of the calendar year.

Now, the half-year residency requirement MAY be an issue, but that depends again on his intent. If the job in Pittsburgh was just temporary in nature, i.e. a summer job taken in order to earn enough to return to school in the fall, the argument could be made that he retained his student status long enough to just meet the half-year requirement so his mother could claim him.

[ebaines]

AtlantaTaxExpert - I must defer to your wisdom and experience on this one! That's the same language as in Pub 501. But Pub 501 also says: "A full time student is a student who is enrolled for the number of hours or courses the school considers to be full time attendance." It then defines "student" with the language you cited. So as I read it the child in this case is definitely a "student," but I can't say he is a "full time" student. It reminds me of that famous quote from a former president - it depends on what the definition of "is" is!

[AtlantaTaxExpert]

LoL!

I have discussed this issue with the IRS, and students who graduate from college or high school in May after spending Jan through May as a full-time student CAN be claimed as dependents on their parents' return that one last time.