If a taxpayer or taxpayer's spouse is claimed as a dependent on someone else's return, the standard deduction on the taxpayer's return is generally reduced and calculated according to the worksheet on page 39 of the instructions for IRS Form 1040 U.S. Individual Income Tax Return.

The standard deduction for an individual for whom an exemption can be claimed on another person's tax return is generally limited to the greater of:

  1. $1,000, or
  2. The individual's earned income for the year plus $350 (but not more than the regular standard deduction amount, generally $6,200).

However, if the individual is 65 or older or blind, the standard deduction may be higher.

Earned income is salaries, wages, tips, professional fees, and other compensation received for personal services you performed. For purposes of the standard deduction, earned income also includes any amounts received as a scholarship that you must include in your gross income.

TaxACT will calculate the standard deduction for you. To indicate that you can be claimed as a dependent on another return:

  1. From within your TaxACT return (Online or Desktop) click the Federal Q&A tab
  2. Click Basic Information to expand the section, then click Dependent on someone else's tax return
  3. Click Yes if you can be claimed as a dependent on another return

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