Hal_Al
Level 15

Education

You listed your expenses as $4001 tuition and $5993 R&B = 9994.   $3400 + 7476 = $10,876.

10,876 - 9994 =  882.  What did the other $882 pay for?  If qualified expenses, then yes, the taxable amount is reduced. Apparently enough, that she doesn't HAVE TO file.  However, if she needs to file to get a refund of withholding, technically you are suppose to go to the trouble of adding the taxable amount, even though it doesn't matter (no change in the refund amount). 

 

(5994 + 882) / 7476 = 91.97% of the distribution is qualified. 8.025% isn't

0.08025 x 2334 = $187 reportable unearned income 

 

Q. Some of her income is unearned interest so I believe she will still need to file a return, but won't owe any taxes.   Does this sound correct?

A. No.  It depends on the amount of interest. If less than $263, then she doesn't need to file. If more, she must file and will owe tax. There is no situation, where she has to file and there is no calculated tax.