If you are single or married and been on your own for some time and over the age of 25, then you already know that your parents cannot claim you on your taxes in any form. But if you are single, 25 and under, and have lived with your parents as a dependent prior to going off to college, they your parents can still claim your schooling as a tax deduction on their taxes. Even if you are living away from home living in a dorm or an apartment, this is considered temporary living and your main living environment is in the home you have been brought up with your parents.
Living with your parents does not mean you cannot claim your schooling on your tax form. However your parents cannot claim you as a dependent and claim the schooling on their taxes. It is either the student or the parent, but not both that can claim this. More of that is explained by the IRS and tax software.
There are three types of tax credits that can be added to the tax form.
1. The American Opportunity tax credit which you or your parents can claim on the tax form by $2,500 for the tuition, fees, supplies and books. This does not include all supplies and books; there are stipulations to this that are covered in the IRS manual or your tax software. Also to quality you must be working towards a degree. This tax credit is good for the first four years of college.
2. The Lifetime Learning tax credit can reduce your taxes (or parents taxes, depending on which way it is claimed) up to $2,000 for your expenses paid to the college in the form of required books, supplies and tuition. This is the easiest one to claim for you do not have to be a fulltime student. Even if you had attended only one course during the entire year, this tax credit can be claimed.
3. A tuition credit deduction for up to $4,000 can be claimed on your taxes or your parents provided that the taxes are itemized.
Not all these tax credits for schooling apply to every family. Not all these deductions can be claimed. Depending on the income and situation of schooling you may be able to only take the Lifetime Learning tax credit or the itemized tuition deduction.
The IRS (though often difficult to many to understand everything that is written) explains everything that you need to know for the student or parents of the student to see whether they can claim the college education off on their taxes.
Often it is easier to have someone else do your taxes as in an accountant or tax service. This is usually costly. If you are a student and don't plan on itemizing on your tax form. Or if you are a parent of a student and don't have that many deductions to begin with, then the cost of a tax service does not always make sense to go to. Especially true with filling out taxes if you are filling out a few forms for your taxes.
It then makes better sense to prepare your taxes yourself. The easiest way with the less headaches and will guarantee to find more deductions is tax software. These are found at many retail stores, like Target, Best Buy and Office Depot. Make sure to look in the newspaper for special deals.
Even better when you can find tax software coupons found on CouponSnapshot where all types of coupon codes are their business to help you save money.