Deductions & credits

They have to be your dependent under age 24 full time student, under 19, or any age permanently disabled; and claimed on your tax return if they meet the eligibility of your dependent, and you must provide for at least half their support for the year. If not, they will have to claim on their taxes. Not eligible for the American Opportunity Tax Credit because she has 4 years of college already. But, you are probably eligible for the LLC or Lifetime Learning Credit. Which provides a 20% deduction on up to 10,000 in eligible educational expenses. up to a 2,000 credit, non refundable, but deductible dollar for dollar on taxes due which could increase your refund or lower your tax liability. They must also select I can be claimed by someone else when doing the students return if you are indeed claiming them.

To claim qualified education expenses with the LLC or Lifetime Learning Credit which are:

• Tuition,
• Expenses for course-related books, supplies, and equipment that must be paid to the institution as a condition of enrollment or attendance, and
• Student-activity fees that must be paid to the institution as a condition of enrollment or attendance

The Lifetime Learning Credit is reduced when your modified adjusted gross income (MAGI) is between $160,000 and $180,000. You are not eligible to claim the Lifetime Learning Credit if your MAGI is $180,000 or more.
 

• If you received a 1099-q for your 529 make sure to input
• enter the 1098-T
• Follow the instructions on qualified tuition plans in the interview after entering the 1099Q and 1098T, select continue instead of add another 1099Q or 1098T to get to the questions once you see your summary click continue to enter the selected interview questions to guide you to the tax free portion of your 529
   

Note: Your MAGI is the AGI modified by adding back any: 1) Foreign earned income exclusion, 2) Foreign housing exclusion, 3) Foreign housing deduction, 4) Exclusion of income by bona fide residents of American Samoa, and 5) Exclusion of income by bona fide residents of Puerto Rico.

 

If you choose to claim the Lifetime Learning Credit, your credit is limited by your tax liability and other non-refundable credits. This is probably your biggest educational deduction/credit you will qualify for.

@confusedrf