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errata
New Member

tuition deduction

I made too much money for my parents to claim me on their return  I paid for my school tuition-more than $7000, and turbo tax keeps saying that my deduction is denied as someone else may be claiming me as a dependent on their taxes.  I answered the question in the beginning "can someone else claim you on their taxes" with NO.  Why won't the program let me deduct my tuition?

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2 Replies
FangxiaL
Expert Alumni

tuition deduction

Tuition deduction is no longer applicable for tax year 2021. Depending on your income, you may qualify for American Opportunity Tax Credit or Lifetime Learning credit. 

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Hal_Al
Level 15

tuition deduction

@errata said "I made too much money for my parents to claim me on their return".  That may not be so.

 

There are two types of dependents, "Qualifying Children"(QC) and Other ("Qualifying Relative" in IRS parlance even though they don't have to actually be related). There is no income limit for a QC but there is an age limit, student status, a relationship test and residence test.

A child of a taxpayer can still be a “Qualifying Child” (QC) dependent, regardless of his/her income, if:

  1. He is under age 19, or under 24 if a full time student for at least 5 months of the year, or is totally & permanently disabled
  2. He did not provide more than 1/2 his own support. Scholarships are excluded from the support calculation
  3. He lived with the parent (including temporary absences such as away at school) for more than half the year

So, it doesn't matter how much he earned. What matters is how much he spent on support. Money he put into savings does not count as support he spent on him self.

The support value of the home, provided by the parent, is the fair market rental value of the home plus utilities & other expenses divided by the number of occupants.

The IRS has a worksheet that can be used to help with the support calculation. See: http://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf

 

There's a new urban myth among college students that says they can get a $1000 from the government just for filing a tax form. For most of them, they simply aren't eligible. A full time unmarried student, under age 24, even if you don't qualify as a dependent, is only eligible for the refundable portion of the American Opportunity Credit if he supports himself by working. You cannot be supporting yourself on parental support, 529 plans or student loans & grants. You usually must have actually paid tuition, not had it paid by scholarships & grants.  It is usually best if the parent claims that credit. 

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Reference: Line 7 instructions for form 8863. https://www.irs.gov/instructions/i8863

 

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