The tuition credit follows the student's dependency. Only the parent claiming the student as a dependent can claim the tuition credit, regardless of who actually paid the tuition* or has the higher income. If no one is claiming the student as a dependent, then the student can claim the tuition credit on his own return. **
*Although the general rule, in taxes, is that you must be the one making the payment, to get the deduction or credit, there is an exception for education.
**While technically there is a provision that allows your student-dependent to claim a federal tuition credit, from a practical matter it seldom works out. A full time student, under age 24, is only eligible for the refundable portion of the American Opportunity Credit (AOTC) if he/she supports himself by working. She cannot be supporting herself on student loans & grants and 529 plans and parental support. It is usually best if the parent claims that credit.
If the student actually has a tax liability, there is a provision to allow him to claim a non-refundable tuition credit. But then the parent must forgo claiming the student as a dependent, and the $500 other dependent credit. The student must still indicate that he can be claimed as a dependent, on his return. This is worth up to $2500 (AOTC shifts to all non refundable)
If the student is claimed as your dependent then you claim education credit. If you didn’t claim the student then the student claims it.
Please explain more clearly. Is there an issue between you and another parent who wants to claim the student as a dependent and get the education credit? Provide some details.
The tuition credit follows the student's dependency. Only the parent claiming the student as a dependent can claim the tuition credit, regardless of who actually paid the tuition* or has the higher income. If no one is claiming the student as a dependent, then the student can claim the tuition credit on his own return. **
*Although the general rule, in taxes, is that you must be the one making the payment, to get the deduction or credit, there is an exception for education.
**While technically there is a provision that allows your student-dependent to claim a federal tuition credit, from a practical matter it seldom works out. A full time student, under age 24, is only eligible for the refundable portion of the American Opportunity Credit (AOTC) if he/she supports himself by working. She cannot be supporting herself on student loans & grants and 529 plans and parental support. It is usually best if the parent claims that credit.
If the student actually has a tax liability, there is a provision to allow him to claim a non-refundable tuition credit. But then the parent must forgo claiming the student as a dependent, and the $500 other dependent credit. The student must still indicate that he can be claimed as a dependent, on his return. This is worth up to $2500 (AOTC shifts to all non refundable)