Am I absolutely required to take an exemption on my 1040A? If I don't, I'll still get back all my fed money because of education credits, but the amount I owe the state will drop. Is this legal?

2/19/2007 5:46:38 PM

Your question doesn't really make sense to me. An exemption should reduce your tax burden and you normally want to claim as many exemptions as possible.

You cannot claim yourself as an exemption if someone else is claiming you as a dependent.

2/19/2007 6:10:19 PM

North Carolina adds $800 to your taxable income for every exemption you claim on your federal tax return. By not taking the exemption for myself, I reduce my taxable income by 800 and therefore the money I owe by $50.

Not taking the exemption will not affect the amount of money I'll get back from my federal return because I'm taking an education credit for all the tuition I paid as an out-of-state student that reduces my federal tax owed to $0.

I'm asking if anyone knows if it's required that I take an exemption or not??

2/19/2007 7:52:57 PM

I guess your federal taxable income is $0.00, or very close to it?

Offhand, I wouldn't think that you'd be required to claim an exemption since not claiming an exemption would increase the tax burden for most people. You seem to fall into the odd category of your deductions being sufficiently large and income sufficiently low that the normal $3300 exemption doesn't affect your federal taxes.

I'd start looking here: http://www.dor.state.nc.us/

2/19/2007 8:40:28 PM

you don't have to claim any exemptions. I always claimed zero while i was in school.

2/19/2007 8:44:56 PM

Cool, thanks guys.

2/19/2007 9:34:46 PM

Here is a wake up call. You cant claim any education credits or take the tuition and fees deduction if you dont claim yourself.

Also if you claim yourself on your federal return you federal taxable income that carries to the D-400 should be a negative number. Thus adding back the $800 for a personal exemption should not create any NC taxable income.

2/21/2007 9:36:06 AM

^I'm 26. I haven't been a dependent for several years now. I did go back through and look at the numbers again and caught where I made the mistake you're pointing out, though . Thanks for pointing that out!

2/21/2007 9:44:40 AM