Carrie Said:

If I am a college a student can I claim the college tax credit?

We Answered:

So you are a adult college student is that correct?
Yes you can if you are a qualifying student and meet all of the rules that you have to meet to qualify you to claim any of the education benefits that are available to you.
The eligible student is either yourself, your spouse or a dependent for whom you claim an exemption on your tax return.
Go to the www.irs.gov website and use the search box for Publication 970 (2009),

http://www.irs.gov/publications/p970/ind…

Tax Benefits for Education
American Opportunity Credit
Hope Credit
Lifetime Learning Credit
Deductions
Tuition and Fees Deduction
Student Loan Interest Deduction
Business Deduction for Work-Related Education

Kristina Said:

What kind of college student tax credit can I get?

We Answered:

This is a great question, and quite relevant to a large number of the people who post here and read answers in this section, but, unfortunately, the answer is complex.

There are three tax adjustments that are available to students or families who pay certain types of higher education expenses in a tax year - the Hope Tax Credit (sometimes confusingly called the Hope Scholarship Credit), the Lifetime Learning Credit, and the Tuition and Fees Deduction.

It all gets very complex and confusing, beyond that.

A taxpayer can only take one of the Hope, the Lifetime Learning or the Tuition and Fees Deduction each year - per student. For example, if the Smith Family has 2 children in college, they could take the Hope Credit for Bobby and the Lifetime Learning Credit for Cathy, or they could take the Hope Credit for both of them - they just can't take more than one per child. The Smiths could also take the Hope this year and next year, and then take the Tuition and Fees Deduction in year three.

Each of the three adjustments has its own special rules - the Hope Credit, for example, can only be taken for a maximum of two years for any one student - and those two years must be the freshman and sophomore years of college. A taxpayer can not take a Hope Credit for a student who has already been in school for at least 2 years - even if they never claimed the Hope credit for that student in the past.

The Hope Credit is also limited by the Adjusted Gross Income of the taxpayer. If the taxpayer reports more than $58,000 as a single filer, or $116,000 as a joint filer, they can not claim the Hope Credit. If they report an AGI between $48,000 and $58,000 ($96,000-$116,000 joint filers), they can only take a portion of the Hope Credit.

The Hope Credit can only be taken if the taxpayer owes a payment of additional taxes to the IRS. If you owe nothing, or you are due a refund, you can not claim the Hope Credit - the Hope Credit is known as a non-refundable credit. If a taxpayer owes $393 in taxes, the largest Hope Credit they would be able to claim is the $393 that would bring their tax payment to $0.

The Hope Credit can not be taken by a taxpayer who is claimed as a dependent on any other taxpayer's return. (Unless it's a spouse).

I think you're probably starting to understand what I meant when I said this whole issue was waaaay too complex to lend itself to a simple Yahoo! Answers response. So far, I've only explained part of the rules for the Hope Credit, and I haven't even touched on the Lifelong Learning and the Tuition and Fees Deduction.

The best answer is - yes - there are special tax treatments of educational expenses available to students and the families of students who pay for post-secondary education at an eligible institution of higher education. If you want to take the fullest possible advantage of these potential savings, your best bet is to either turn your tax preparation over to a qualified professional, or, if you're very comfortable with them - to use one of the computerized tax preparation tools, like TurboTax.

Make sure you have received a Form 1098-T from your school. No matter which of the tax treatments you choose, you will need documentation of your eligible educational expenses.

If you're really, really brave, you can refer to IRS Publication 970 for all of the rules that apply to the treatment of educational expenses, and financial aid. You'll find a direct link to that publication below. It's a great read if you're having trouble sleeping, too.

Good luck!

Victoria Said:

Tax credit for college students??

We Answered:

Yes there is

From www.irs.gov

http://www.irs.gov/individuals/article/0…

The form you need to fill out is an 8863 and can be found here:
http://www.irs.gov/formspubs/lists/0,,id…

Beginning on July 1, 1998, taxpayers may be eligible to claim a nonrefundable Lifetime Learning Credit against their federal income taxes. The Lifetime Learning Credit may be claimed for the qualified tuition and related expenses of the students in the taxpayer's family (i.e., the taxpayer, the taxpayer's spouse, or an eligible dependent) who are enrolled in eligible educational institutions. Through 2002, the amount that may be claimed as a credit is equal to 20 percent of the taxpayer's first $5,000 of out-of-pocket qualified tuition and related expenses for all the students in the family. After 2002, the credit amount is equal to 20 percent of the taxpayer's first $10,000 of out-of-pocket qualified tuition and related expenses. Thus, the maximum credit a taxpayer may claim for a taxable year is $1,000 through 2002 and $2,000 thereafter. These amounts are not indexed for inflation.
If the taxpayer is claiming a Hope Scholarship Credit for a particular student, none of that student's expenses for that year may be applied toward the Lifetime Learning Credit. The amount a taxpayer may claim as a Lifetime Learning Credit is gradually reduced for taxpayers who have modified adjusted gross income between $40,000 ($80,000 for married taxpayers filing jointly) and $50,000 ($100,000 for married taxpayers filing jointly). Taxpayers with modified adjusted gross income over $50,000 ($100,000 for married taxpayers filing jointly) may not claim a Lifetime Learning Credit. The modified adjusted gross income limitation will be indexed for inflation in 2002 and years thereafter. The definition of modified adjusted gross income is the same as it is for purposes of the Hope Scholarship Credit.

The Lifetime Learning Credit may be claimed for payments of qualified tuition and related expenses made on or after July 1, 1998, for academic periods beginning on or after July 1, 1998. Therefore, the first time taxpayers will be able to claim the credit will be when they file their 1998 tax returns in 1999. The Lifetime Learning Credit is not available for any amount paid in 1997.

Heidi Said:

Has obamas $4000 tax credit, for college student who do 100 hours of community service, come into effect?

We Answered:

Andy - I have no idea what the other gentleman is referring to, because the answer is "no".

The US tax code DOES offer several kinds of tax credits that are available to college students, and to the parents of college students who are footing the bills. In fact, just last month, the IRS launched a new "One Stop Shop" webpage that brings all of the information together in one place. You can find that here: http://www.irs.gov/newsroom/article/0,,i…

You can read information there about the American Opportunity Credit (which modifies and replaces the older Hope Credit), the Lifetime Learning Credit, the tuition and fees deduction, the student loan interest deduction, and the tax treatments of 529 Savings Plans, scholarships, fellowships and financial aid.

There is NO new education tax credit for 2009, unless you want to consider the modified Hope Credit, the American Opportunity Credit, as something "new".

As part of Barack Obama's campaign, he proposed a $4000 tax credit that would reward college students for 100 hours of community service. Since the President's election, that proposal has come under some heavy fire from some Republicans, who fear that Obama's plans to expand AmeriCorps is part of a hidden agenda to expand the size of government:

"By putting a vast army of young people on the government payroll, the Democrats are expanding their reach by teaching the young that government is the answer to every problem. Instead of giving young people an incentive to help others through the free enterprise system or though genuine charity work, Obama and congressional Democrats are creating a make-work boondoggle that will further their control over the political process."

As of this point in time, the proposed volunteer tax credit is no closer to reality than it was when Obama suggested it as a candidate. I'm sure you remember from your American government or civics classes that the President of the US is not constitutionally empowered to create programs without the cooperation of Congress, the government branch that controls the nation's purse-strings.

If you support this type of government spending, that's something to make sure you contact your local representatives about.

I'm sorry for the disappointing news, but visit the IRS page for information about alternative tax savings.

Terry Said:

Obama's Tax credit for college students?

We Answered:

You claim the tax credit on your tax return.