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[Ned Flanders]

Do qualified tuition payments count as an exemption? In other words can you deduct your tuition payments from your gross income (I'm assuming with the appropriate form) when calculating your taxable income?

My brother is attending college for the first time this year (well, 04/05) and he owes a couple hundred dollars on his taxes. When I asked him if he factored in his tuition payments to his taxable income, he didn't know what the hell I was talking about, and considering I just let my accountant do everything (including when I attended school), I really didn't know what the hell I was talking about either. A laymans guess had me figuring that if he owed a couple hundred dollars, and his tuition was obviously far greater than that (the school mailed him a form with the total amount), that he may in fact be owed a refund instead of vice versa. He's already filed, so I guess he's screwed, but it really forced me to confront my ignorance on basic tax protocol. Now I'm suddenly paranoid that my accountant could be fabricating the whole process and I'm too uninformed to know the difference. Then again, I'm getting a refund, so I don't know what I'm bitching about...

 

[Cerebral Palsy]

Yeah, you can claim your tuition. I'm not exactly sure how it's done though. I've never done my own taxes before. I just give everything to my parents heh

 

[aoi tsuki]

i don't know if it qualifies as an exemption per se, but tuition does count in your favor.

You may be able to deduct qualified tuition and related expenses that you pay for yourself, your spouse, or a dependent. To determine whether your expenses are qualified, refer to Topic 605 or Publication 970, Tax Benefits for Education. You do not have to itemize to take this deduction because it is treated as an adjustment to income. For tax year 2004, you can claim qualified tuition and fees as either: (1) an adjustment to income, as directed above; or (2) a Hope or Lifetime Learning credit.

You cannot deduct higher education expenses on your income tax return if you or anyone else claims a Hope or Lifetime learning credit based on those SAME expenses.

You cannot claim a deduction or credit based on expenses paid with tax-free scholarship, fellowship, grant, or education savings account funds such as a Coverdell education savings account, tax-free savings bond interest or employer-provided education assistance. The same rule applies to expenses you pay with a tax-exempt distribution from a qualified tuition plan, except that you can deduct qualified expenses you pay only with that part of the distribution that is a return of your contribution to the plan. Also, you cannot deduct qualified education expenses you deduct anywhere else on your return, such as a business expense. Refer to Topics 310, 403 and 421.

In 2004, if your modified adjusted gross income (MAGI) does not exceed $65,000 ($130,000 if married filing jointly) you are entitled to a maximum deduction of $4,000 per year. If your MAGI is greater than $65,000 ($130,000), but is not more than $80,000 ($160,000 if you are married filing jointly), your maximum tuition and fees deduction is $2,000. No tuition and fees deduction is allowed if your MAGI is larger than $80,000 ($160,000).

http://www.irs.gov/taxtopics/tc457.html

i've included tuition in my taxes a couple years back. Can't remember where it applies, TurboTax for the web has been my savior for four years now.

 

[marko]

You can either deduct tuition from your total taxable income, or you can use the hope scholarship (first 2 college years), or lifetime learning scholarship. These are tax credits. Hope scholarship is a 100% credit for first $1000 and 50% of next $1000 of tuition (only qualified expenses not room/board etc) for a total of $1500. Lifetime is a flat credit of 20% up to $10,000 for a total of $2000. More than likely, lifetime/hope are a much better option. Pretty sure one can file an amended return to get this money

This is perfect example why you should use turbo tax on web. All these questions asked, best option figured out for you. Really quite easy/useful.

Also, this is just what I know, not an expert or anything.

 

[Amused_To_Death]

You can either deduct tuition from your total taxable income, or you can use the hope scholarship (first 2 college years), or lifetime learning scholarship. These are tax credits. Hope scholarship is a 100% credit for first $1000 and 50% of next $1000 of tuition (only qualified expenses not room/board etc) for a total of $1500. Lifetime is a flat credit of 20% up to $10,000 for a total of $2000. More than likely, lifetime/hope are a much better option. Pretty sure one can file an amended return to get this money

This is perfect example why you should use turbo tax on web. All these questions asked, best option figured out for you. Really quite easy/useful.

Also, this is just what I know, not an expert or anything.

You are correct, he can use the Hope credit since it's his first year. It's been created for people like him. AND, he actually gets CREDIT which is money back to him compared to an exemption which lowers the amount of taxes he pays. Listen to the man, use Turbotax.com. Hey, I hope you knew the deadline for filing was Friday!!!