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Education
Yes, we can reduce taxes for all, there are options. The expenses go on the same return as the student. The 529 plan goes on the return of the person whose name is on it unless it covers all education expenses, then it does not have to reported. Our goal, get the 529 to cover education expenses if possible.
Box 1 is only the college. You had more expenses for items required by the school, books, paper, stuff. Add those costs together.
Box 5 scholarship went towards room and board - living expenses to some degree. The question is to figure out how much. The more you put towards room and board, then less is left for education. Remember, the goal is to get that 529 used for college expenses. The more that goes towards living expenses, the more goes into her scholarship income. Her tax rate is low, $0 for the first $12,400 versus your tax rate. Plus, if you can get education credit to boot, win- win!
It is a tricky game getting all the numbers figured out. The IRS allows you to be smart with your money.
Please look at another of my answers for help. .on how to do this.
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