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Summer Tax Tip #2 – Support a Recent Graduate
If your child recently graduated from college, this is probably the last year you can claim a dependency exemption for him or her. However, you must provide more than half of the child’s annual support to qualify for the $4,000 exemption. To clear the half-support threshold, consider giving the graduate a generous graduation gift, such as a car to be used on the first job. Unfortunately, dependency exemptions may be reduced for high-income taxpayers.