Taxpayers Who Can Be Claimed as Dependents

The standard deduction is generally lower for an individual who can be claimed as a dependent on another person's tax return. The deduction is generally limited to the greater of:

• $950, or
• The individual's earned income for the year, plus $300 (but not more than the regular standard deduction amount)

All of these rules are included on the standard deduction worksheet for dependents.

During the interview, verify how the taxpayer marked the check box for a dependent being claimed by another taxpayer.

Janet is single, 22, a full-time student, and not blind. Her parents claimed her as a dependent on their 2011 tax return. She has no itemized deductions, so she will take the standard deduction. She has interest income of $120, taxes withheld of $35, and wages of $780. Her standard deduction is $1,080 ($780 + $300).