8863 Refundable credit

[crisjtc09]

I'm doing my taxes through TT and when I get to the 8863 form there seems to be a problem. I can't get the refundable credit for the AOTC even though I am under 24, live with my parents but fully support myself (earned income was more than one-half of my support, we split everything 50-50, and they don't claim me as a dependent), and I'm a full-time student (the box is not checked in line 7). Do I not qualify for it or am I missing to answer something in TT?

[Hal_Al · Accepted solution]

Q. Do I not qualify for it or am I missing to answer something in TT?

A.  Based on your description, you do qualify (your earned income is more that half your support). You've answered something wrong in the interview. 

When TurboTax sees that you are a FT student, under 24, it will add the earned income support question to the interview. The earned income support question is part of the personal info interview, not  the education interview.

Go thru the personal info  section again and be sure you answered that question correctly (or you answered the preceding questions correctly to generate that question). 

That said, it's not that clear that that you do provide more than half your own support. 

The support value of the home, provided by the parent, is the fair market rental value of the home plus utilities & other expenses divided by the number of occupants.

The IRS has a worksheet that can be used to help with the support calculation. See: http://apps.irs.gov/app/vita/content/globalmedia/teacher/worksheet_for_determining_support_4012.pdf

[crisjtc09]

I've gone through my info page again and I have the full-time student and support myself selection both on yes, with no dependents or anyone that can declare me as a dependant selected but that doesn't fix it. I went through my 1098-T options to see if I missed selecting something that would change it but everything seems where it's supposed to be, nothing really seems to check the box in line 7 of form 8863. I've seen in other posts that one way to do it is to select "Another taxpayer can claim me as a dependent on their tax return." and say no to the  "Will this person claim you on their 2024 tax return?" that comes after but won't that affect the rest of my return as well? When I tried to do so it asked me to add the recipient's SSN to my 1095-A form as if I wasn't the principal on it when I am and there are no other individuals on my policy statement for last year. Would it be okay to put mine on it or is it doing it that way wrong altogether?

[crisjtc09]

Even when I try to do it like I mentioned before it doesn't let me enter my SSN because it's expecting my 1095-A form to be added to my parents' taxes or that's what the description on top of the "issue" says.

[Hal_Al]

" support myself selection on yes"

The support yourself question is not good enough. You have to get the support yourself with earned income question 

I just tried it (Desktop Deluxe). It seems simple:

-Don't check the box that says somebody can claim you

-Say yes to working on a degree

-Check full time student

-Check yes to provide more than half your support with earned income

In the educational expenses section, at the "Here's your education summary" screen, click edit at "Education Information" and go thru the qualifying interview again (or delete the student and do the whole section again)

"Another taxpayer can claim me as a dependent on their tax return." and say no to the  "Will this person claim you on their 2024 tax return?" 

That will allow you to claim the nonrefundable portion of the AOTC. If you have a $2500 tax liability, that will work. 

"When I tried to do so it asked me to add the recipient's SSN to my 1095-A form as if I wasn't the principal on it when I am and there are no other individuals on my policy statement for last year. Would it be okay to put mine on it or is it doing it that way wrong altogether?"

Huh? I'm not familiar with form 1095-A, so I don't try to answer questions in that area. That said, I've never heard of it affecting the AOTC.

[crisjtc09]

Here's what I did based on the advice you gave me:

I went into the "My Info" section and checked the box that said, "Another taxpayer can claim me as a dependent on their tax return" followed by checking no to the "Will this person claim you on their 2024 tax return?" question. Afterward, I checked the one that said "I was a full-time student" and the option that popped up afterward "Did you support yourself?" as a yes. There weren't more questions in this section about my income or my ability to support myself.

In the educational expenses section, I clicked edit at "Education Information" and answered the interview as follows: Yes, I was working on one of these degrees. I am in full-time enrollment status for 2024. I haven't earned a four-year degree before, and this is not my first day of college. Yes, I have received the AOTC once and no I haven't ever had a felony drug conviction. 

After selecting those options, my refund amount reflected the refundable money from the AOTC. However, when I went to submit my taxes for file, a message saying that some mistakes needed correction before being able to file popped up. I checked said error and it was the same error from before when I tried to do this before posting my issue here. The error was asking me to input the recipient's SSN from my 1095-A form in the specified field. I put mine because I'm the principal and the only person in that insurance statement since I don't share the account with the rest of my family. The problem is that regardless of how many times I put my SSN it keeps going back to that same "error" because it's expecting me to add the SSN of the person that can declare me as a dependent in their taxes but is not doing so (because of the selections made before). In the reason for the error, it says that their SSN is required because my information needs to be attached to their taxes which would make no sense since they are not declaring me as a dependent either way. The only way for me to fix this error is to deselect the "Another taxpayer can claim me as a dependent on their tax return" which takes away the refundable credit from the AOTC.

Is there anything I'm doing wrong or that I'm missing? I'm really confused about all this. I don't know if this makes any difference but I'm using both the online desktop version and the Android version of TT. Thank you for all your help.

[Hal_Al]

You said:

I went into the "My Info" section and checked the box that said, "Another taxpayer can claim me as a dependent on their tax return" followed by checking no to the "Will this person claim you on their 2024 tax return?" 

Earlier, you said:

 " I fully support myself (earned income was more than one-half of my support."

That means Another taxpayer can NOT claim you as a dependent.  

That's why I said:

 -DON'T check the box that says somebody can claim you. You don't get the earned income question if you say you CAN be claimed (no matter how you answer the "somebody will" question).

[crisjtc09]

I initially didn't have that box checked and that question didn't appear during the interview question for the education expenses part. I tried deleting and starting it back up and that question never appeared.