I am 23 years old Studying at University I do not work. I've heard about American Credit Opportunity for students. Do I qualify for it? I take student loans t pay tuition

[maglib · Accepted solution]

Whoever claims you as a dependent is eligible for the education credits.  Most likely your parent is claiming the education benefits or is claiming you.  

Unless you provide over half your own support (IRS SUPPORT TEST https://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf) since you are a full time student your parents are most likely eligible to claim you as a dependent.

If nobody is claiming you, and you are eligible to claim yourself  you then can claim the education credits.  Did you get a 1098-T from your university?  You enter that and other school expenses and any scholarships, grants.  All payments are reduced by any 1099-Q's you received.  Do not double dip.

If someone else is eligible to claim you as a dependent and they choose not to, you are only eligible for the education credits as a reduction of your tax liability.

So speak to whomever claims you as a dependent...

If you feel you are eligible then in the search box type 1098-T and select jump to that section of the interview.  Enter your 1098-T exactly as received.  There is a pulldown box under box 2 if the amount you paid for tuition is greater than listed on the 1098-T.  You enter room and board on subsequent screens and scholarships and grants (1099Q is only entered if it is in excess of tuition).  Then after all the entries, keep going to you get to a screen about education credits and make sure you hit the button "maximize my education credits".
TT should walk you through the process.

[vkmicro]

I'm just gonna admit this, this is SUPER confusing stuff.
I've never done my own taxes.
Usually my mother claimed me as dependent but right now, due to health conditions she's unable to work anymore and was acknowledged as disabled, her only income now is Social Security benefits, and due to that she's not filing taxes since she has no income aside from that.

So I have to do my own taxes and I'm really confused about everything honestly...

so, I do have Form 1098-T from my university.
what do I do next?  Should I do that test you mentioned?
What do you mean by provide over half of my own support? as mentioned above, my mother's only income is social security, so I'm taking loans to both pay my tuition, provide for myself as much as I can and help out if I can in the house... Does that count?

Please let me know.
Thank you so much for your help.

[maglib]

First decide who can claim you. IRS has a calculator and you can fill from both your parents and your side <a rel="nofollow" target="_blank" href="https://www.irs.gov/help/ita/whom-may-i-claim-as-a-dependent">https://www.irs.gov/help/ita/whom-may-... mom may still want to file a tax return if she can claim you as the AOTC is a refundable credit.  Who paid for the upkeep of your home and who paid for your schooling?  Support does not necesarilly need to be earned income, it could be savings that you or your mother have.  I can not see if you have earned income from wages or not as this is a public forum.   Go through the support test first, decide who is paying for your housing, it really walks you through it.   Basically, you have expenses for your food, shelter, college and the money is coming for those items from your own sources or your moms or others.
There will also be a question asking if you provided over half your own support from earned income and based on what you said with taking loans and such, the answer is probably no.  If you can take your dependency and the answer is no on earned income, you only get education credits to the extent of your tax liability.  If you can claim you had earned income to cover half your support (by default that means you can claim your personal exemption), you would be eligible for the full education credits and even possibly a refund.  If your mom can claim you as a dependent, if you didn't provide over half your own support, you should have your mom file a tax return as she could claim the education credits.  Did you use any 529 plans for college, or any grants and scholarships?

[vkmicro]

Hello.
Thank you so much for getting back to me.

So from what I saw with that calculator as well as what you said, it sounds like my mother has to claim me as dependent.
I definitely didn't provide half of my own support.

I receive a PellGrant from FAFSA which pays most of my tuition but I'm still left paying about $1500 per semester, for which I take loans.

[maglib]

See if having your mom claim you and files is better than you filing your own return and not getting refundable portion of education credits works best.  Only 1 of you can claim the expenses. Do you have any other income on your return as minimally if you mom doesn't file, you will be able to reduce your tax liability to 0.

[maglib]

So if your mom doesn't file, answer the questions on your return saying that someone else is eligible to claim you but they won't be and you will at least reduce your tax liability to 0.