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Free Tax Filing For Low Income Families

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Free Tax Filing For Low Income Families

Free tax filing for low income families 6. Free tax filing for low income families   Tuition and Fees Deduction Table of Contents IntroductionWhat is the tax benefit of the tuition and fees deduction. Free tax filing for low income families Can You Claim the DeductionWho Can Claim the Deduction Who Cannot Claim the Deduction What Expenses QualifyQualified Education Expenses No Double Benefit Allowed Expenses That Do Not Qualify Who Is an Eligible Student Who Can Claim a Dependent's Expenses Figuring the DeductionEffect of the Amount of Your Income on the Amount of Your Deduction Claiming the Deduction Illustrated Example Introduction You may be able to deduct qualified education expenses paid during the year for yourself, your spouse, or your dependent(s). Free tax filing for low income families You cannot claim this deduction if your filing status is married filing separately or if another person can claim an exemption for you as a dependent on his or her tax return. Free tax filing for low income families The qualified expenses must be for higher education, as explained later under Qualified Education Expenses . Free tax filing for low income families What is the tax benefit of the tuition and fees deduction. Free tax filing for low income families   The tuition and fees deduction can reduce the amount of your income subject to tax by up to $4,000. Free tax filing for low income families   This deduction is taken as an adjustment to income. Free tax filing for low income families This means you can claim this deduction even if you do not itemize deductions on Schedule A (Form 1040). Free tax filing for low income families This deduction may be beneficial to you if you do not qualify for the American opportunity or lifetime learning credits. Free tax filing for low income families You can choose the education benefit that will give you the lowest tax. Free tax filing for low income families You may want to compare the tuition and fees deduction to the education credits. Free tax filing for low income families See chapter 2, American Opportunity Credit and chapter 3, Lifetime Learning Credit for more information on the education credits. Free tax filing for low income families Table 6-1. Free tax filing for low income families Tuition and Fees Deduction at a Glance summarizes the features of the tuition and fees deduction. Free tax filing for low income families Can You Claim the Deduction The following rules will help you determine if you can claim the tuition and fees deduction. Free tax filing for low income families Who Can Claim the Deduction Generally, you can claim the tuition and fees deduction if all three of the following requirements are met. Free tax filing for low income families You pay qualified education expenses of higher education. Free tax filing for low income families You pay the education expenses for an eligible student. Free tax filing for low income families The eligible student is yourself, your spouse, or your dependent for whom you claim an exemption on your tax return. Free tax filing for low income families The term “qualified education expenses” is defined later under Qualified Education Expenses . Free tax filing for low income families “Eligible student” is defined later under Who Is an Eligible Student . Free tax filing for low income families For more information on claiming the deduction for a dependent, see Who Can Claim a Dependent's Expenses , later. Free tax filing for low income families Table 6-1. Free tax filing for low income families Tuition and Fees Deduction at a Glance Do not rely on this table alone. Free tax filing for low income families Refer to the text for complete details. Free tax filing for low income families Question Answer What is the maximum benefit? You can reduce your income subject to tax by up to $4,000. Free tax filing for low income families What is the limit on modified adjusted gross income (MAGI)? $160,000 if married filing a joint return; $80,000 if single, head of household, or qualifying widow(er). Free tax filing for low income families Where is the deduction taken? As an adjustment to income on  Form 1040 or Form 1040A. Free tax filing for low income families For whom must the expenses be paid? A student enrolled in an eligible educational institution who is either: •you,  •your spouse, or  •your dependent for whom you claim an exemption. Free tax filing for low income families What tuition and fees are deductible? Tuition and fees required for enrollment or attendance at an eligible postsecondary educational institution, but not including personal, living, or family expenses, such as room and board. Free tax filing for low income families Who Cannot Claim the Deduction You cannot claim the tuition and fees deduction if any of the following apply. Free tax filing for low income families Your filing status is married filing separately. Free tax filing for low income families Another person can claim an exemption for you as a dependent on his or her tax return. Free tax filing for low income families You cannot take the deduction even if the other person does not actually claim that exemption. Free tax filing for low income families Your modified adjusted gross income (MAGI) is more than $80,000 ($160,000 if filing a joint return). Free tax filing for low income families You (or your spouse) were a nonresident alien for any part of 2013 and the nonresident alien did not elect to be treated as a resident alien for tax purposes. Free tax filing for low income families More information on nonresident aliens can be found in Publication 519. Free tax filing for low income families What Expenses Qualify The tuition and fees deduction is based on qualified education expenses you pay for yourself, your spouse, or a dependent for whom you claim an exemption on your tax return. Free tax filing for low income families Generally, the deduction is allowed for qualified education expenses paid in 2013 in connection with enrollment at an institution of higher education during 2013 or for an academic period beginning in 2013 or in the first 3 months of 2014. Free tax filing for low income families For example, if you paid $1,500 in December 2013 for qualified tuition for the spring 2014 semester beginning in January 2014, you may be able to use that $1,500 in figuring your 2013 deduction. Free tax filing for low income families Academic period. Free tax filing for low income families   An academic period includes a semester, trimester, quarter, or other period of study (such as a summer school session) as reasonably determined by an educational institution. Free tax filing for low income families In the case of an educational institution that uses credit hours or clock hours and does not have academic terms, each payment period can be treated as an academic period. Free tax filing for low income families Paid with borrowed funds. Free tax filing for low income families   You can claim a tuition and fees deduction for qualified education expenses paid with the proceeds of a loan. Free tax filing for low income families Use the expenses to figure the deduction for the year in which the expenses are paid, not the year in which the loan is repaid. Free tax filing for low income families Treat loan disbursements sent directly to the educational institution as paid on the date the institution credits the student's account. Free tax filing for low income families Student withdraws from class(es). Free tax filing for low income families   You can claim a tuition and fees deduction for qualified education expenses not refunded when a student withdraws. Free tax filing for low income families Qualified Education Expenses For purposes of the tuition and fees deduction, qualified education expenses are tuition and certain related expenses required for enrollment or attendance at an eligible educational institution. Free tax filing for low income families Eligible educational institution. Free tax filing for low income families   An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U. Free tax filing for low income families S. Free tax filing for low income families Department of Education. Free tax filing for low income families It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. Free tax filing for low income families The educational institution should be able to tell you if it is an eligible educational institution. Free tax filing for low income families   Certain educational institutions located outside the United States also participate in the U. Free tax filing for low income families S. Free tax filing for low income families Department of Education's Federal Student Aid (FSA) programs. Free tax filing for low income families Related expenses. Free tax filing for low income families   Student-activity fees and expenses for course-related books, supplies, and equipment are included in qualified education expenses only if the fees and expenses must be paid to the institution as a condition of enrollment or attendance. Free tax filing for low income families Prepaid expenses. Free tax filing for low income families   Qualified education expenses paid in 2013 for an academic period that begins in the first three months of 2014 can be used in figuring an education credit for 2013 only. Free tax filing for low income families See Academic period , earlier. Free tax filing for low income families For example, you pay $2,000 in December 2013 for qualified tuition for the 2014 winter quarter that begins in January 2014, you can use that $2,000 in figuring an education credit for 2013 only (if you meet all the other requirements). Free tax filing for low income families You cannot use any amount you paid in 2012 or 2014 to figure the qualified education expenses you use to figure your 2013 education credit(s). Free tax filing for low income families In the following examples, assume that each student is an eligible student and each college or university an eligible educational institution. Free tax filing for low income families Example 1. Free tax filing for low income families Jackson is a sophomore in University V's degree program in dentistry. Free tax filing for low income families This year, in addition to tuition, he is required to pay a fee to the university for the rental of the dental equipment he will use in this program. Free tax filing for low income families Because the equipment rental fee must be paid to University V for enrollment and attendance, Jackson's equipment rental fee is a qualified education expense. Free tax filing for low income families Example 2. Free tax filing for low income families Donna and Charles, both first-year students at College W, are required to have certain books and other reading materials to use in their mandatory first-year classes. Free tax filing for low income families The college has no policy about how students should obtain these materials, but any student who purchases them from College W's bookstore will receive a bill directly from the college. Free tax filing for low income families Charles bought his books from a friend, so what he paid for them is not a qualified education expense. Free tax filing for low income families Donna bought hers at College W's bookstore. Free tax filing for low income families Although Donna paid College W directly for her first-year books and materials, her payment is not a qualified education expense because the books and materials are not required to be purchased from College W for enrollment or attendance at the institution. Free tax filing for low income families Example 3. Free tax filing for low income families When Marci enrolled at College X for her freshman year, she had to pay a separate student activity fee in addition to her tuition. Free tax filing for low income families This activity fee is required of all students, and is used solely to fund on-campus organizations and activities run by students, such as the student newspaper and the student government. Free tax filing for low income families No portion of the fee covers personal expenses. Free tax filing for low income families Although labeled as a student activity fee, the fee is required for Marci's enrollment and attendance at College X. Free tax filing for low income families Therefore, it is a qualified expense. Free tax filing for low income families No Double Benefit Allowed You cannot do any of the following. Free tax filing for low income families Deduct qualified education expenses you deduct under any other provision of the law, for example, as a business expense. Free tax filing for low income families Deduct qualified education expenses for a student on your income tax return if you or anyone else claims an American opportunity or lifetime learning credit for that same student in the same year. Free tax filing for low income families Deduct qualified education expenses that have been used to figure the tax-free portion of a distribution from a Coverdell education savings account (ESA) or a qualified tuition program (QTP). Free tax filing for low income families For a QTP, this applies only to the amount of tax-free earnings that were distributed, not to the recovery of contributions to the program. Free tax filing for low income families See Coordination With Tuition and Fees Deduction in chapter 8, Qualified Tuition Program, later. Free tax filing for low income families Deduct qualified education expenses that have been paid with tax-free interest on U. Free tax filing for low income families S. Free tax filing for low income families savings bonds (Form 8815). Free tax filing for low income families See Figuring the Tax-Free Amount in chapter 10, Education Savings Bond Program, later. Free tax filing for low income families Deduct qualified education expenses that have been paid with tax-free educational assistance, such as a scholarship, grant, or assistance provided by an employer. Free tax filing for low income families See the following section on Adjustments to Qualified Education Expenses. Free tax filing for low income families Adjustments to Qualified Education Expenses For each student, reduce the qualified education expenses paid by or on behalf of that student under the following rules. Free tax filing for low income families The result is the amount of adjusted qualified education expenses for each student. Free tax filing for low income families You must also reduce qualified education expenses by the other amounts referred to in No Double Benefit Allowed , earlier. Free tax filing for low income families Tax-free educational assistance. Free tax filing for low income families   For tax-free educational assistance received in 2013, reduce the qualified educational expenses for each academic period by the amount of tax-free educational assistance allocable to that academic period. Free tax filing for low income families See Academic period , earlier. Free tax filing for low income families   Some tax-free educational assistance received after 2013 may be treated as a refund of qualified education expenses paid in 2013. Free tax filing for low income families This tax-free educational assistance is any tax-free educational assistance received by you or anyone else after 2013 for qualified education expenses paid on behalf of a student in 2013 (or attributable to enrollment at an eligible educational institution during 2013). Free tax filing for low income families   If this tax-free educational assistance is received after 2013 but before you file your 2013 income tax return, see Refunds received after 2013 but before your income tax return is filed , later. Free tax filing for low income families If this tax-free educational assistance is received after 2013 and after you file your 2013 income tax return, see Refunds received after 2013 and after your income tax return is filed , later. Free tax filing for low income families   This tax-free education assistance includes: The tax-free part of scholarships and fellowships (see Tax-Free Scholarships and Fellowships in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), Pell grants (see Pell Grants and Other Title IV Need-Based Education Grants in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), Employer-provided educational assistance (see chapter 11, Employer-Provided Educational Assistance ), Veterans' educational assistance (see Veterans' Benefits in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), and Any other nontaxable (tax-free) payments (other than gifts or inheritances) received as educational assistance. Free tax filing for low income families Generally, any scholarship or fellowship is treated as tax free. Free tax filing for low income families However, a scholarship or fellowship is not treated as tax free to the extent the student includes it in gross income (if the student is required to file a tax return for the year the scholarship or fellowship is received) and either of the following is true. Free tax filing for low income families The scholarship or fellowship (or any part of it) must be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. Free tax filing for low income families The scholarship or fellowship (or any part of it) may be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. Free tax filing for low income families You may be able to increase the combined value of an education credit and certain educational assistance if the student includes some or all of the educational assistance in income in the year it is received. Free tax filing for low income families For details, see Adjustments to Qualified Education Expenses in chapters 2 and 3. Free tax filing for low income families Refunds. Free tax filing for low income families   A refund of qualified education expenses may reduce adjusted qualified education expenses for the tax year or require repayment (recapture) of a credit claimed in an earlier year. Free tax filing for low income families Some tax-free educational assistance received after 2013 may be treated as a refund. Free tax filing for low income families See Tax-free educational assistance , earlier. Free tax filing for low income families Refunds received in 2013. Free tax filing for low income families   For each student, figure the adjusted qualified education expenses for 2013 by adding all the qualified education expenses for 2013 and subtracting any refunds of those expenses received from the eligible educational institution during 2013. Free tax filing for low income families Refunds received after 2013 but before your income tax return is filed. Free tax filing for low income families   If anyone receives a refund after 2013 of qualified education expenses paid on behalf of a student in 2013 and the refund is paid before you file an income tax return for 2013, the amount of qualified education expenses for 2013 is reduced by the amount of the refund. Free tax filing for low income families Refunds received after 2013 and after your income tax return is filed. Free tax filing for low income families   If anyone receives a refund after 2013 of qualified education expenses paid on behalf of a student in 2013 and the refund is paid after you file an income tax return for 2013, you may need to repay some or all of the credit. Free tax filing for low income families See Credit recapture , later. Free tax filing for low income families Coordination with Coverdell education savings accounts and qualified tuition programs. Free tax filing for low income families   Reduce your qualified education expenses by any qualified education expenses used to figure the exclusion from gross income of (a) interest received under an education savings bond program, or (b) any distribution from a Coverdell education savings account or qualified tuition program (QTP). Free tax filing for low income families For a QTP, this applies only to the amount of tax-free earnings that were distributed, not to the recovery of contributions to the program. Free tax filing for low income families Credit recapture. Free tax filing for low income families    If any tax-free educational assistance for the qualified education expenses paid in 2013 or any refund of your qualified education expenses paid in 2013 is received after you file your 2013 income tax return, you must recapture (repay) any excess credit. Free tax filing for low income families You do this by refiguring the amount of your adjusted qualified education expenses for 2013 by reducing that amount by the amount of the refund or tax-free educational assistance. Free tax filing for low income families You then refigure your education credit(s) for 2013 and figure the amount by which your 2013 tax liability would have increased if you had claimed the refigured credit(s). Free tax filing for low income families Include that amount as an additional tax for the year the refund or tax-free assistance was received. Free tax filing for low income families Example. Free tax filing for low income families   You paid $3,500 of qualified education expenses in December 2013, and your child began college in January 2014. Free tax filing for low income families You claimed $3,500 as the tuition and fees deduction on your 2013 income tax return. Free tax filing for low income families The reduction reduced your taxable income by $3,500. Free tax filing for low income families Also, you claimed no tax credits in 2013. Free tax filing for low income families Your child withdrew from two classes and you received a refund of $2,000 in 2014 after you filed your 2013 tax return. Free tax filing for low income families Refigure your 2013 tuition and fees deduction using $1,500 of qualified education expense instead of the $3,500. Free tax filing for low income families The refigured tuition and fees deduction is $1,500. Free tax filing for low income families Do not file an amended 2013 tax return to account for this adjustment. Free tax filing for low income families Instead, include the difference of $2,000 (but only to the extent this difference would have increased your 2013 tax) on the “Other income” line of your 2014 Form 1040. Free tax filing for low income families You cannot file Form 1040A for 2014. Free tax filing for low income families Amounts that do not reduce qualified education expenses. Free tax filing for low income families   Do not reduce qualified education expenses by amounts paid with funds the student receives as: Payment for services, such as wages, A loan, A gift, An inheritance, or A withdrawal from the student's personal savings. Free tax filing for low income families   Do not reduce the qualified education expenses by any scholarship or fellowship reported as income on the student's tax return in the following situations. Free tax filing for low income families The use of the money is restricted, by the terms of the scholarship or fellowship, to costs of attendance (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1, Scholarships, Fellowships, Grants, and Tuition Restrictions. Free tax filing for low income families The use of the money is not restricted. Free tax filing for low income families Example 1. Free tax filing for low income families In 2013, Jackie paid $3,000 for tuition and $5,000 for room and board at University X. Free tax filing for low income families The university did not require her to pay any fees in addition to her tuition in order to enroll in or attend classes. Free tax filing for low income families To help pay these costs, she was awarded a $2,000 scholarship and a $4,000 student loan. Free tax filing for low income families The terms of the scholarship state that it can be used to pay any of Jackie's college expenses. Free tax filing for low income families University X applies the $2,000 scholarship against Jackie's $8,000 total bill, and Jackie pays the $6,000 balance of her bill from University X with a combination of her student loan and her savings. Free tax filing for low income families Jackie does not report any portion of the scholarship as income on her tax return. Free tax filing for low income families In figuring the tuition and fees deduction, Jackie must reduce her qualified education expenses by the amount of the scholarship ($2,000) because she excluded the entire scholarship from her income. Free tax filing for low income families The student loan is not tax-free educational assistance, so she does not need to reduce her qualified expenses by any part of the loan proceeds. Free tax filing for low income families Jackie is treated as having paid $1,000 in qualified education expenses ($3,000 tuition – $2,000 scholarship) in 2013. Free tax filing for low income families Example 2. Free tax filing for low income families The facts are the same as in Example 1, except that Jackie reports her entire scholarship as income on her tax return. Free tax filing for low income families Because Jackie reported the entire $2,000 scholarship in her income, she does not need to reduce her qualified education expenses. Free tax filing for low income families Jackie is treated as having paid $3,000 in qualified education expenses. Free tax filing for low income families Expenses That Do Not Qualify Qualified education expenses do not include amounts paid for: Insurance, Medical expenses (including student health fees), Room and board, Transportation, or Similar personal, living, or family expenses. Free tax filing for low income families This is true even if the amount must be paid to the institution as a condition of enrollment or attendance. Free tax filing for low income families Sports, games, hobbies, and noncredit courses. Free tax filing for low income families   Qualified education expenses generally do not include expenses that relate to any course of instruction or other education that involves sports, games or hobbies, or any noncredit course. Free tax filing for low income families However, if the course of instruction or other education is part of the student's degree program, these expenses can qualify. Free tax filing for low income families Comprehensive or bundled fees. Free tax filing for low income families   Some eligible educational institutions combine all of their fees for an academic period into one amount. Free tax filing for low income families If you do not receive, or do not have access to, an allocation showing how much you paid for qualified education expenses and how much you paid for personal expenses, such as those listed above, contact the institution. Free tax filing for low income families The institution is required to make this allocation and provide you with the amount you paid (or were billed) for qualified education expenses on Form 1098-T. Free tax filing for low income families See Figuring the Deduction , later, for more information about Form 1098-T. Free tax filing for low income families Who Is an Eligible Student For purposes of the tuition and fees deduction, an eligible student is a student who is enrolled in one or more courses at an eligible educational institution (as defined under Qualified Education Expenses , earlier). Free tax filing for low income families Who Can Claim a Dependent's Expenses Generally, in order to claim the tuition and fees deduction for qualified education expenses for a dependent, you must: Have paid the expenses, and Claim an exemption for the student as a dependent. Free tax filing for low income families For you to be able to deduct qualified education expenses for your dependent, you must claim an exemption for that individual. Free tax filing for low income families You do this by listing your dependent's name and other required information on Form 1040 (or Form 1040A), line 6c. Free tax filing for low income families IF your dependent is an eligible student and you. Free tax filing for low income families . Free tax filing for low income families . Free tax filing for low income families AND. Free tax filing for low income families . Free tax filing for low income families . Free tax filing for low income families THEN. Free tax filing for low income families . Free tax filing for low income families . Free tax filing for low income families claim an exemption for your dependent you paid all qualified education expenses for your dependent only you can deduct the qualified education expenses that you paid. Free tax filing for low income families Your dependent cannot take a deduction. Free tax filing for low income families claim an exemption for your dependent your dependent paid all qualified education expenses no one is allowed to take a deduction. Free tax filing for low income families do not claim an exemption for your dependent you paid all qualified education expenses no one is allowed to take a deduction. Free tax filing for low income families do not claim an exemption for your dependent your dependent paid all qualified education expenses no one is allowed to take a deduction. Free tax filing for low income families Expenses paid by dependent. Free tax filing for low income families   If your dependent pays qualified education expenses, no one can take a tuition and fees deduction for those expenses. Free tax filing for low income families Neither you nor your dependent can deduct the expenses. Free tax filing for low income families For purposes of the tuition and fees deduction, you are not treated as paying any expenses actually paid by a dependent for whom you or anyone other than the dependent can claim an exemption. Free tax filing for low income families This rule applies even if you do not claim an exemption for your dependent on your tax return. Free tax filing for low income families Expenses paid by you. Free tax filing for low income families   If you claim an exemption for a dependent who is an eligible student, only you can include any expenses you paid when figuring your tuition and fees deduction. Free tax filing for low income families Expenses paid under divorce decree. Free tax filing for low income families   Qualified education expenses paid directly to an eligible educational institution for a student under a court-approved divorce decree are treated as paid by the student. Free tax filing for low income families Only the student would be eligible to take a tuition and fees deduction for that payment, and then only if no one else could claim an exemption for the student. Free tax filing for low income families Expenses paid by others. Free tax filing for low income families   Someone other than you, your spouse, or your dependent (such as a relative or former spouse) may make a payment directly to an eligible educational institution to pay for an eligible student's qualified education expenses. Free tax filing for low income families In this case, the student is treated as receiving the payment from the other person and, in turn, paying the institution. Free tax filing for low income families If you claim, or can claim, an exemption on your tax return for the student, you are not considered to have paid the expenses and you cannot deduct them. Free tax filing for low income families If the student is not a dependent, only the student can deduct payments made directly to the institution for his or her expenses. Free tax filing for low income families If the student is your dependent, no one can deduct the payments. Free tax filing for low income families Example. Free tax filing for low income families In 2013, Ms. Free tax filing for low income families Baker makes a payment directly to an eligible educational institution for her grandson Dan's qualified education expenses. Free tax filing for low income families For purposes of deducting tuition and fees, Dan is treated as receiving the money from his grandmother and, in turn, paying his own qualified education expenses. Free tax filing for low income families If an exemption cannot be claimed for Dan on anyone else's tax return, only Dan can claim a tuition and fees deduction for his grandmother's payment. Free tax filing for low income families If someone else can claim an exemption for Dan, no one will be allowed a deduction for Ms. Free tax filing for low income families Baker's payment. Free tax filing for low income families Tuition reduction. Free tax filing for low income families   When an eligible educational institution provides a reduction in tuition to an employee of the institution (or spouse or dependent child of an employee), the amount of the reduction may or may not be taxable. Free tax filing for low income families If it is taxable, the employee is treated as receiving a payment of that amount and, in turn, paying it to the educational institution on behalf of the student. Free tax filing for low income families For more information on tuition reductions, see Qualified Tuition Reduction , in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. Free tax filing for low income families Figuring the Deduction The maximum tuition and fees deduction in 2013 is $4,000, $2,000, or $0, depending on the amount of your MAGI. Free tax filing for low income families See Effect of the Amount of Your Income on the Amount of Your Deduction , later. Free tax filing for low income families Form 1098-T. Free tax filing for low income families   To help you figure your tuition and fees deduction, the student should receive Form 1098-T (see Appendix A for a completed example of Form 1098-T). Free tax filing for low income families Generally, an eligible educational institution (such as a college or university) must send Form 1098-T (or acceptable substitute) to each enrolled student by January 31, 2014. Free tax filing for low income families An institution may choose to report either payments received (box 1), or amounts billed (box 2), for qualified education expenses. Free tax filing for low income families However, the amount in boxes 1 and 2 of Form 1098-T might be different than what you paid. Free tax filing for low income families When figuring the deduction, use only the amounts you paid in 2013 for qualified education expenses. Free tax filing for low income families   In addition, Form 1098-T should give other information for that institution, such as adjustments made for prior years, the amount of scholarships or grants, reimbursements or refunds, and whether the student was enrolled at least half-time or was a graduate student. Free tax filing for low income families    The eligible educational institution may ask for a completed Form W-9S or similar statement to obtain the student's name, address, and taxpayer identification number. Free tax filing for low income families Effect of the Amount of Your Income on the Amount of Your Deduction If your MAGI is not more than $65,000 ($130,000 if you are married filing jointly), your maximum tuition and fees deduction is $4,000. Free tax filing for low income families If your MAGI is larger than $65,000 ($130,000 if you are married filing jointly), but is not more than $80,000 ($160,000 if you are married filing jointly), your maximum deduction is $2,000. Free tax filing for low income families No tuition and fees deduction is allowed if your MAGI is larger than $80,000 ($160,000 if you are married filing jointly). Free tax filing for low income families Modified adjusted gross income (MAGI). Free tax filing for low income families   For most taxpayers, MAGI is adjusted gross income (AGI) as figured on their federal income tax return before subtracting any deduction for tuition and fees. Free tax filing for low income families However, as discussed below, there may be other modifications. Free tax filing for low income families MAGI when using Form 1040A. Free tax filing for low income families   If you file Form 1040A, your MAGI is the AGI on line 22 of that form, figured without taking into account any amount on line 19 (tuition and fees deduction). Free tax filing for low income families MAGI when using Form 1040. Free tax filing for low income families   If you file Form 1040, your MAGI is the AGI on line 38 of that form, figured without taking into account any amount on line 34 (tuition and fees deduction) or line 35 (domestic production activities deduction), and modified by adding back any: Foreign earned income exclusion, Foreign housing exclusion, Foreign housing deduction, Exclusion of income by bona fide residents of American Samoa, and Exclusion of income by bona fide residents of Puerto Rico. Free tax filing for low income families   Table 6-2 shows how the amount of your MAGI can affect your tuition and fees deduction. Free tax filing for low income families   You can use Worksheet 6-1. Free tax filing for low income families MAGI for the Tuition and Fees Deduction , later, to figure your MAGI. Free tax filing for low income families Table 6-2. Free tax filing for low income families Effect of MAGI on Maximum Tuition and Fees Deduction IF your filing status is. Free tax filing for low income families . Free tax filing for low income families . Free tax filing for low income families AND your MAGI is. Free tax filing for low income families . Free tax filing for low income families . Free tax filing for low income families THEN your maximum tuition and fees deduction is. Free tax filing for low income families . Free tax filing for low income families . Free tax filing for low income families single,  head of household, or qualifying widow(er) not more than $65,000 $4,000. Free tax filing for low income families more than $65,000  but not more than $80,000 $2,000. Free tax filing for low income families more than $80,000 $0. Free tax filing for low income families married filing joint return not more than $130,000 $4,000. Free tax filing for low income families more than $130,000 but not more than $160,000 $2,000. Free tax filing for low income families more than $160,000 $0. Free tax filing for low income families Claiming the Deduction You claim a tuition and fees deduction by completing Form 8917 and submitting it with your Form 1040 or Form 1040A. Free tax filing for low income families Enter the deduction on Form 1040, line 34, or Form 1040A, line 19. Free tax filing for low income families A filled-in Form 8917 is shown at the end of this chapter. Free tax filing for low income families Illustrated Example Tim Pfister, a single taxpayer, enrolled full-time at a local college to earn a degree in engineering. Free tax filing for low income families This is the first year of his postsecondary education. Free tax filing for low income families During 2013, he paid $3,600 for his qualified 2013 tuition expense. Free tax filing for low income families Both he and the college meet all of the requirements for the tuition and fees deduction. Free tax filing for low income families Tim's total income (Form 1040, line 22) and MAGI are $26,000. Free tax filing for low income families He figures his deduction of $3,600 as shown on Form 8917, later. Free tax filing for low income families Worksheet 6-1. Free tax filing for low income families MAGI for the Tuition and Fees Deduction Use this worksheet if you are filing Form 2555, 2555-EZ, or 4563, or you are excluding income from sources within Puerto Rico. Free tax filing for low income families Before using this worksheet, you must complete Form 1040, lines 7 through 33, and figure any amount to be entered on the dotted line next to line 36. Free tax filing for low income families 1. Free tax filing for low income families Enter the amount from Form 1040, line 22   1. Free tax filing for low income families         2. Free tax filing for low income families Enter the total from Form 1040, lines 23 through 33   2. Free tax filing for low income families               3. Free tax filing for low income families Enter the total of any amounts entered on the dotted line next to Form 1040, line 36   3. Free tax filing for low income families               4. Free tax filing for low income families Add lines 2 and 3   4. Free tax filing for low income families         5. Free tax filing for low income families Subtract line 4 from line 1   5. Free tax filing for low income families         6. Free tax filing for low income families Enter your foreign earned income exclusion and/or housing  exclusion (Form 2555, line 45, or Form 2555-EZ, line 18)   6. Free tax filing for low income families         7. Free tax filing for low income families Enter your foreign housing deduction (Form 2555, line 50)   7. Free tax filing for low income families         8. Free tax filing for low income families Enter the amount of income from Puerto Rico you are excluding   8. Free tax filing for low income families         9. Free tax filing for low income families Enter the amount of income from American Samoa you are  excluding (Form 4563, line 15)   9. Free tax filing for low income families         10. Free tax filing for low income families Add lines 5 through 9. Free tax filing for low income families This is your modified adjusted gross income   10. Free tax filing for low income families     Note. Free tax filing for low income families If the amount on line 10 is more than $80,000 ($160,000 if married filing jointly),  you cannot take the deduction for tuition and fees. Free tax filing for low income families       This image is too large to be displayed in the current screen. Free tax filing for low income families Please click the link to view the image. Free tax filing for low income families Form 8917 for Tim Pfister Prev  Up  Next   Home   More Online Publications

Publication 15 (2014), (Circular E), Employer's Tax Guide

For use in 2014


Table of Contents


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The Free Tax Filing For Low Income Families

Free tax filing for low income families Index A Application for enrollment, Form 23 and Form 23-EP. Free tax filing for low income families , Form 5434. Free tax filing for low income families Assistance (see Tax help) Associations, Corporations, associations, partnerships, and other persons that are not individuals. Free tax filing for low income families Attorneys, Attorneys. Free tax filing for low income families Authorization letter, Authorization for Special Appearances C CAF number, Authorization for Special Appearances Certified public accountants (CPAs), Certified public accountants (CPAs). Free tax filing for low income families Comments, Comments and suggestions. Free tax filing for low income families Corporations, Corporations, associations, partnerships, and other persons that are not individuals. Free tax filing for low income families CPAs (see Certified public accountants (CPAs)) D Disbarment, Suspension and disbarment. Free tax filing for low income families , Censure, Disbarments, and Suspensions Disreputable conduct, Incompetence and Disreputable Conduct E Enrolled actuaries, Enrolled actuaries. Free tax filing for low income families Enrolled agent:, Enrolled agents. Free tax filing for low income families , How Does an Individual Become Enrolled? Enrolled retirement plan agent:, Enrolled retirement plan agents. Free tax filing for low income families F FAX copies, FAX copies. Free tax filing for low income families Form 23 and Form 23-EP, Form 23 and Form 23-EP. Free tax filing for low income families Form 2587, Form 2587. Free tax filing for low income families Form 2848, Form Required, Preparation of Form — Helpful Hints, How Do I Fill Out Form 2848? Form 5434, Form 5434. Free tax filing for low income families Free tax services, How To Get Tax Help G Glossary, Practice Before the IRS, Authorizing a Representative H Help (see Tax help) I Inactive retirement status, Inactive retirement status. Free tax filing for low income families Inactive roster, Inactive roster. Free tax filing for low income families Incapacity or incompetency, Incapacity or incompetency. Free tax filing for low income families L Loss of eligibility Failure to meet requirements, Failure to meet requirements. Free tax filing for low income families Loss of eligibility:, Loss of Eligibility M More information (see Tax help) N Non-IRS power of attorney, Non-IRS powers of attorney. Free tax filing for low income families O Office of Professional Responsibility, Practice Before the IRS P Partnerships, Corporations, associations, partnerships, and other persons that are not individuals. Free tax filing for low income families Power of attorney Processing and handling, Processing and Handling Representative, Dealing With the Representative Power of attorney:, What Is a Power of Attorney?, When Is a Power of Attorney Required?, Where To File a Power of Attorney, When Is a Power of Attorney Not Required?, What Happens to the Power of Attorney When Filed? Practice before the IRS, What Is Practice Before the IRS?, Who Can Practice Before the IRS?, Who Cannot Practice Before the IRS? Processing a non-IRS power of attorney, Processing a non-IRS power of attorney. Free tax filing for low income families Protected communication Tax shelters, Communications regarding corporate tax shelters. Free tax filing for low income families Publications (see Tax help) R Registered tax return preparers and unenrolled return preparers, Registered tax return preparers and unenrolled return preparers. Free tax filing for low income families Representation outside the United States, Representation Outside the United States Restrictions, Restrictions Rules of practice Due diligence, Due diligence. Free tax filing for low income families Duties, Duties Duty to advise, Duty to advise. Free tax filing for low income families Restrictions, Restrictions Rules of practice:, What Are the Rules of Practice? S Special appearances, Authorization for Special Appearances Students. Free tax filing for low income families , Student. Free tax filing for low income families , Students in LITCs and the STCP. Free tax filing for low income families Suggestions, Comments and suggestions. Free tax filing for low income families Suspension, Suspension and disbarment. Free tax filing for low income families , Censure, Disbarments, and Suspensions T Tax help, How To Get Tax Help Taxpayer advocate, Taxpayer Advocate Service. Free tax filing for low income families Termination, Incapacity or incompetency. Free tax filing for low income families TTY/TDD information, How To Get Tax Help U Unenrolled individuals Employee, Other individuals who may serve as representatives. Free tax filing for low income families Family member, Other individuals who may serve as representatives. Free tax filing for low income families Fiduciary, Other individuals who may serve as representatives. Free tax filing for low income families Individual, Other individuals who may serve as representatives. Free tax filing for low income families Officer, Other individuals who may serve as representatives. Free tax filing for low income families Partner, Other individuals who may serve as representatives. Free tax filing for low income families Unenrolled individuals:, Other individuals who may serve as representatives. Free tax filing for low income families W Where to file:, Where To File a Power of Attorney Prev  Up     Home   More Online Publications