You need to determine if the student is a dependent. If a parent claims his or her student as a dependent, then that’s who gets to take the tax credit or education deduction.
Whether it’s the American Opportunity Tax Credit or the Lifetime Learning Credit, only one person gets the tax advantage and it often comes down to whether the student is a dependent in the eyes of the IRS. If a student is a dependent on someone else’s tax return, the student doesn’t qualify for these tax breaks.
If a student isn’t claimed as a dependent, though, it’s possible for him or her to claim an education tax credit, or take the deduction. One thing to keep in mind, each student cannot claim more than one tax break.
Your parents may claim the student loan interest depending on how the loan is set up: If the debt is in parent's name, parents can claim the deduction if they paid it.
