Reporting a dependent's income

[TamiA]

I am completing my friend's tax return. She is separated and they have 2 children under 18 who are dependents.  Her and her spouse are each claiming one of the children. Both children have income.  Before she added her child's income, she was getting almost $3000.  Her child is filing their own return for income earned.  It has the space that says "child's income".  When she put her child's income in, $12,000-ish, it then changed her refund to $500.  Her child's income is not her income, she sees none of that income.  Her child's income tax return will deal with their income, is this doubly taxing it?  She shouldn't lose money because her child made money.  Please help.  Am I missing something?

[Geo123]

Hello,

The dependant is filing their own return so only enter the income in the child's file, if entering again in the mother's return, for any potential dependant credit transfers do not not Netfile.  Only Netfile from the child's file.

[Shamsul]

This is most probably due to the fact that child's income reduces the credit amount (usually 15,000 for 2024) for an eligible dependent. With 12K income, the credit amount goes down to 3K from 15K.