Hello Experts,
Hope to get some help here, your help is greatly appreciated!
I have two 1099-Q, one for Coverdell from Schwab $3,000 with recipient as my daughter SSN, another one from state 529 total $13,830 to my SSN.
But the expenses from last year 1098-T shows $15,053 on box1, and $1,750 on ox 5 and $885 for box 4, My daughter started living in off campus apartment starting Aug last year for about $3,500 for apt rental total for 2023, also grocery and a school trip airfair toral $600, and $180 books. I need $4,000 expenses not covered by 529/coverdell to claim the full AOTC. But so far I don't have $4,000 extra expenses.
Since the Coverdell one has her SSN, and she earned summer intern income of $8,580, I will file tax for her and enter 1099-Q Coverdell $3,000 on her return, this way my return has less 1099-Q distribution and I can have more expenses than 1099-Q to claim AOTC, although still not enough to claim full AOTC. TT thinks my cost basis for coverdell is less than the value at the end of last year so it think she need to pay tax around $230.
I have calimed AOTC for 2 years and this will the third year. For the graduation year, I plan to use the Lifetime Learning Credit.
For the expenses for 2023, I can not use the living rental fee for the first half of the year since she lived in school housing and I paid it at the end of 2022, so I guess it is not 2023 expenses.
I took the coverdell money out in Dec 2023, I am still within 60 days to roll over it since the TT form asked if I rolled it over. But it will be in 2024, not sure if the trouble worth it.
Also I dont think the cost basis calculated for the end of 2023 by Schwab was correct, it used the cost basis of my most most recent purchase, but overall I lost money on this account, Schwab does not have the full history since it was transferred from another brokerage. Can I use my total contribution as the cost basis? For example if I contributed 2,000 dollar a year for 5 years, now I only have $9,000 in it, I lost money.
Is there any way to take the full AOTC? I dont think I can take Life time learning credit this year and take AOTC later, since I will have the same issue for this year.
For the graduation year of 2025, I plan to pay the school in Jan 2025 instead of Dec 2024 so I have expenses for the 5th year to use Life time learning credit (LLC) since I can only take AOTC 4 years. Or may be I should take LLC for 2024 tax year since 2024 has more expenses and AOTC for 2025 since it only needs $4,000.
Sorry for the long question.
