If your daughter will be under age 19 by the end of the year, you probably can claim a dependency exemption for her, even though she is on active duty and has gross income over the exemption amount ($4,050 in 2016). She merely has to have lived with you for more than half the year, but military service is treated as a temporary absence. However, if she’s at least 19 years old by the end of the year, you’re out of luck. At this age, she’s no longer a qualifying child and can’t be claimed as a dependent if her gross income exceeds the exemption amount, which you say it will.
An amount taken from income as a prepayment of an individual’s tax liability for the year. In the case of wages, the employer withholds part of every wage payment. Backup withholding from dividend or interest income is required if you do not provide the payer with a correct taxpayer identification number. Withholding on pensions and IRAs is automatic unless you elect to waive withholding.