Full-time student - am I a dependent for tax purposes despite paying my own expenses?

The dependency test for tax purposes is actually pretty specific and being a full-time student alone doesn't automatically make you a dependent. There are several tests that must be met: 1) Age Test: You're 21 and a full-time student, so you do meet this part (the cutoff is under 24 for students). 2) Relationship Test: As their child, you meet this test. 3) Residency Test: Did you live with your parents for more than half the year? (Temporary absences like being away at school usually count as living at home). 4) Support Test: This is the key one for you. To be claimed as a dependent, your parents must provide MORE THAN HALF of your total support. If you're paying for your own rent, food, and most expenses, and they're only covering car insurance, it sounds like you might not meet this test. Calculate the total cost of your support (housing, food, education, medical, etc.) and determine who paid what percentage. If you provided more than 50%, you shouldn't be claimed as a dependent. And yes, dependency status definitely affects health insurance applications since the marketplace will consider household income differently based on whether you're a dependent or filing your own taxes.

After dealing with similar confusion when I was in college, I found an amazing tool on https://taxr.ai that helps figure out dependency status. It asks really specific questions about your living situation and who pays for what, then tells you if you legally qualify as a dependent. It saved me so much stress because it turns out my parents had been incorrectly claiming me for years! The tool also explained how to handle the situation with the IRS and gave me a detailed breakdown I could show my parents to prove I should be filing independently. Might be worth checking out since your situation with health insurance applications will be much easier to resolve once you know your correct tax status for sure.

After being skeptical about online tax tools, I finally tried https://taxr.ai and have to admit it was incredibly helpful. I was in a similar situation - parents claiming me despite me paying most of my own expenses. The dependency calculator showed I was providing 68% of my own support! The documentation it generated helped me have a productive conversation with my parents. They agreed to stop claiming me, and I filed independently this year. That immediately solved my health insurance marketplace issues since now only my income counts. My premium tax credit went from $0 (when calculated with my parents' income) to covering most of my monthly payment. Totally worth checking out if you're in dependency limbo.

If your parents incorrectly claimed you as a dependent and won't fix it, you might need to talk to the IRS directly. I was in this exact situation and tried calling them for WEEKS with no success. Always busy signals or 2+ hour hold times that would disconnect. Finally found https://claimyr.com and their service is a game-changer. They basically hold your place in the IRS phone queue and call you when an agent is about to pick up. You can see how it works in their demo: https://youtu.be/_kiP6q8DX5c Talking directly to an IRS agent solved everything - they explained exactly what forms I needed to file to correct my status, and how to handle the health insurance marketplace application as an independent filer. The agent was surprisingly helpful once I actually got through!

I'll eat my words on this one. After calling the IRS myself and waiting over 3 hours only to get disconnected, I broke down and tried the Claimyr service mentioned above. Got connected to an IRS agent in about 45 minutes without having to sit by my phone the whole time. The agent confirmed that based on my situation (very similar to yours - I pay my own rent, food, etc. and my parents only help with a few smaller expenses), I should be filing independently. They explained that my parents claiming me incorrectly was affecting my healthcare subsidies and financial aid. They walked me through filing a paper return to correct the situation since my parents had already e-filed claiming me. For the health insurance specifically, once your tax filing reflects your correct independent status, you can update your marketplace application and qualify for subsidies based on your income alone.

Something to consider - if your parents are claiming you incorrectly as a dependent, they could potentially face issues if audited. The penalty for incorrectly claiming a dependent can be pretty significant. It might be worth having a conversation with them showing the actual IRS rules about the support test. My parents were claiming me until I showed them that I was paying over 60% of my own expenses, and they had no idea they were doing anything wrong. They thought as long as I was in school full-time and under 24, they could claim me regardless of who was paying the bills.

All these comments are helpful but I think we're missing something basic - have you talked to your parents about this? Before going to the IRS or using any tools, I'd just sit down with them and go through the actual support calculations together. Show them that you're covering your own rent, food, etc., and calculate what percentage they're actually providing. Many parents just assume they should claim their college students without actually checking the support test requirements.

This is such a common situation and I'm glad you're getting it sorted out! One thing I want to add that hasn't been mentioned much - make sure to keep detailed records of all your expenses and payments going forward. I learned this the hard way when my parents and I disagreed about who was providing more support. Having bank statements, receipts, and a simple spreadsheet showing monthly expenses like rent, groceries, utilities, etc. makes the conversation so much easier and more objective. Also, once you do establish that you're independent, don't forget to update your FAFSA for next year's financial aid. Your expected family contribution will likely be much lower when it's based on your $10k income instead of your parents' income, which could mean significantly more grant money for school. The healthcare piece is huge too - being able to get subsidies based on your own income rather than your parents' can save thousands per year. It's definitely worth having that conversation with your parents this weekend!