Can I claim the American Opportunity Credit? I am 22, I made $6,000 during the year, parents gave me ~$350 a month, paid tuition with loans in my name, and was full-time.

[Carl]

Are you the "primary" borrower on the student loans?
There is a support requirement here. Before you can even think about claiming anything, you first have to determine (and be able to prove) if you provided more than half of your own support for the entire year. The requirement is as follows:

If the STUDENT did NOT provide MORE than 50% of the STUDENT'S support, then the parents qualify to claim that student as a dependent on the parents tax return. The parents will also claim any and all education credits they qualify for.

Understand two things.
 - Scholarships, grants, 529/1009-Q funds, gifts from Aunt Mary, etc., do NOT COUNT as the student providing their own support.
 - There is NO requirement for the parents to provide ANY support. Not one single penny.

Overall, it's better for the parents to claim the student on their tax return, along with all the education credits. If the student claims the education credits, the student doesn't get anywhere near the tax breaks the parents do.
Basically I'd say that if you only earned $6000 for the tax year, there's absolutely no way you provided more than 50% of your own support. However, if you are the primary borrower on the loans *AND* you haven't started to pay back the loans yet, then you very well may be able to take the self-exemption. But since that borrowed money is NOT your money, you will not get anywhere near the credits and tax breaks your parent's can get.
The AOC credit is based on qualified education expenses paid out of YOUR pocket, and it's an absolute waste for you to take ANY education credits, because you won't get them.
Your standard deduction on your 2017 tax return is $6350. So just with that you will be getting all taxes withheld from your paychecks refunded to you "WITHOUT" claiming one penny of education expenses.
So let your parents claim you as a dependent and let your parents take all the education credits for 2017.

[mm195412]

My parents did not claim me last year, because they provided about ~$4,000 in support and I have $5,000 in income. My parents gave me about 1/3 of the income I used to support myself (rent, food, recreation). I spent 100% of the year besides 2 weeks of christmas holiday and 1 week of summer living on my own. Would this count as over 50% support?

[mm195412]

I am also the primary borrower on my loans, my parents cosigned and are responsible if I default for the first two years, but after that they are fully transferred to my name.

[Carl]

Again, there is no requirement for your parents to provide any support. Not a penny. If you only made $5000 or $6000 in income, then there's no way on this green earth you provided more than 50% of your own support with that. But as I stated earlier, but didn't word it clearly, the student loans count for you providing your own support if *and only if* you are the PRIMARY borrower on the loan. Are you?
As for the AOC, you don't have the "earned" income to get any tax credits at all.

[Carl]

Got it. You're primary borrower. So you're good provided the loan money distributed to you in 2017 is enough to convince the IRS you provided more than 50% of your support, and all other income sources (like scholarships) from unearned sources are not enough to cover 50% of your support.

[Carl]

As for the AOC, you can "claim" it. But I doubt you'll get anything from it.

[mm195412]

My rent was ~$267 a month and I had about $200 in living expenses. I worked and made about $600 a month. Would that not be over half of my support?

[mm195412]

If I make $600, my parents provide $350 and my expenses are $467?

[Carl]

NOpe, not even close. Support includes things like your tuition, books, lab fees, rent, utilities, clothing, transportation, food, and a few other things I can't think of off the top of my head right now. But as the primary borrower on the loans, if payback on the borrowed money hasn't started yet, that borrowed money counts for you providng your own support.
Keep it mind that even so, it may not work out the way you would think either. Here's how the IRS looks at it.
 - First, scholarships, grants and 1099-Q funds are applied to qualified education expenses. Any of those funds left over are taxable income TO THE STUDENT, since the school refunds any excess to the student before the end of the tax year.
 - Next, money earned by the student in the tax year is applied to  the qualified education expenses *if* the student actually used money they earned to pay them with.
 - Next money borrowed by the student (if the student is the PRIMARY borrower) is applied to the above.
 
So for example, if your qualified education expenses (tuition, books, lab fees) came to lets say, $10,000 for the entire tax year, and you received $20,000 in scholarships, grants and 1099-Q funds, then even if you earned a million dollars, it's seriously doubtful that you provided more than 50% of your own support with money *you* physically earned or borrowed in the same tax year.
WIth $10K in qualified education expenses and another $10K of that left over for non-qualified expenses (such as rent for example) it's seriously doubtful it cost you more than 40K to support yourself the entire year. Half of your support was covered by the $20K in scholarships and grants. So *you* could not have possibly provided more than 50% of your own support - even if you earned or borrowed $50K.

[mm195412]

Why would I not get anything? If I took out $10,000 in loans for tuition, that gets me the $4,000 max qualified educational expenses in part 3, seeing as the definition for qualified educational expenses is "payments made in cash, by check, by credit or debit card, or with borrowed funds such as a student loan, to be applied to qualified education expenses." This gives me the max $2,500 for the AOTC, $1,000 of which is refundable?

[mm195412]

I had $2,000 in scholarships, $10,000 in loans, $6,000 wages, $4,000 parents support.

[Carl]

YOu can't get back from the IRS, what you have not already paid to them. The *ONLY* taxes you have paid for 2017, is the taxes that were withheld from your paychecks in 2017. You said you earned a mere $6K in 2016. So about $700-$800 of that was withheld from your paychecks by your employer and sent to the IRS on your behalf.
Now when you file your tax return, you *automatically* get to exclude the first $6,350 of your "earned' income from taxation, just because you breath. So all money withheld from all your paychecks received in 2017 will be refunded to you in full. The IRS isn't going to give you more back, than what you've paid in.

[mm195412]

Also I really appreciate your help, I didn't realize my parents couldn't (and didn't) claim me last year, so I need to amend a return for that. I had the same situation this year. So I could potentially get $2,000 more back this year between the ammended return and this one, which would help alot in getting ready for grad school.

[Carl]

Have your parents use the worksheet at <a rel="nofollow" target="_blank" href="https://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf...> to help determine the support issue. Its' designed to be completed from the parent's perspective. Due to the fact your parent's gave you money each month, that money gets counted for the support test, and it's not "your" money either, since you did not go out and earn it.