Another question about the AOC

<p>Hello,</p>

<p>I started to attend ECPI on Jan 30 2012 and left Nov 20 2012 and transferred to J Sarge.</p>

<p>My 1098 says 1. 16,105.00
Grants were 6,825.00
I was at least half time</p>

<p>But my out of pocket cost for monthly payments were 2,992.00 for the duration I was there and still owe 1,695.00, would that be calculated in the 16,105.00? </p>

<p>I am confused on how I am not eligible for the AOC, I am using Tax Act to do my 2012 taxes and is there a way I can work this out to where I can get something back from it?</p>

<p>Or am i just not eligible? and my wages for 2012 were 10981.19.</p>

<p>If I left out any info that is needed let me know and thanks for any feed back!</p>

<p>Is the $16,105 the tuition and fees? If the tuition and fees were $16,105 and the total grants/scholarships were $6,825 it certainly seems you should be eligible for the AOC. If you meet all the criteria, it is possible you answered a question wrong on the tax return</p>

<p>Check how you answered the following questions:

  • can you be claimed as a dependent by someone else (only the person claiming the exemption can claim the AOC)
  • Are you in the first 4 years of an undergrad program (AOC is only for undergrads in the first 4 years - not grad students etc)</p>

<p>Also have a look at page 10 of the IRS 970 to check if you fail to meet one of the criteria
<a href=“http://www.irs.gov/pub/irs-pdf/p970.pdf[/url]”>http://www.irs.gov/pub/irs-pdf/p970.pdf&lt;/a&gt;&lt;/p&gt;

<p>You or your parents should be eligible for AOTC per those numbers.
However, see one of many websites about AOTC [Tax</a> Information - My Online Services](<a href=“http://bellevuecollege.edu/services/hope/hope.asp]Tax”>http://bellevuecollege.edu/services/hope/hope.asp)

</p>

<p>If you have troubles to get the TAXACT to work, you could get help from one of many IRS VITA sites. VITA will prepare your taxes at no costs.</p>

<p>Check how you answered the following questions:
No, I can not - can you be claimed as a dependent by someone else (only the person claiming the exemption can claim the AOC)
Yes, I am - Are you in the first 4 years of an undergrad program (AOC is only for undergrads in the first 4 years - not grad students etc)</p>

<p>Is the $16,105 the tuition and fees? Yes, they are.</p>

<p>I went back multiple times and it does not calculate up…I am lost.</p>

<p>I am going to try this now, will let you guys know what this says.-If you have troubles to get the TAXACT to work, you could get help from one of many IRS VITA sites. VITA will prepare your taxes at no costs.</p>

<p>Never mind, thought it was a online tool.</p>

<p>It just says I am getting back Federal and State, nothing more…I know I qualify, Tax Act even says I do…but it does not add it in</p>

<p>You want to try other tax software, like Turbotax.
See [Free</a> File: Do Your Federal Taxes for Free](<a href=“http://www.irs.gov/uac/Free-File%3A-Do-Your-Federal-Taxes-for-Free]Free”>http://www.irs.gov/uac/Free-File%3A-Do-Your-Federal-Taxes-for-Free)</p>

<p>Are you using the online TaxAct or a purchased copy? </p>

<p>I don’t know if the online lets you look at how the actual tax forms were filled out by the program or not, but unless you look at the forms, you wouldn’t know if the amount it shows getting back from federal includes the AOC or not.</p>

<p>Qualifies for:<br>
American opportunity credit: Yes
Lifetime learning credit: Yes
Tuition and fees deduction: Yes
Qualified tuition and fees: $16,105
Qualified course materials: $0
Total education expenses: $16,105
Tax-free assistance and adjustments: $6,825
Total qualified education expenses: $9,280</p>

<p>Here’s a summary of the higher education tax benefit on your federal return.
Tuition and fees deduction: $4,000
Lifetime learning credit: $0
American opportunity credit: $0
Refundable part of AOC: $0</p>

<p>What does this mean? This is what Tax Act says but does not let me view it when I end up going to submit.</p>

<p>But, when I get to this screen is shows this</p>

<p>Your Credits and Payments: 2011 2012<br>
Foreign tax credit: $0 $0 Review
Child and dependent care expenses: $0 $0 Review
Education credits: $0 $0 Review
Retirement savings contributions credit: $0 $0 Review
Child tax credit: $0 $0 Review
Residential energy credits: $0 $0 Review
Other credits: $0 $0 Review
Federal income tax withheld: $438 $572 Review
Estimated tax payments/prior year applied: $0 $0 Review
Earned income credit: $0 $0 Review
Additional child tax credit: $0 $0 Review
American opportunity credit: $0 $0 Review
Amount paid with extension: $0 $0 Review
Excess social security and tier I RRTA: $0 $0 Review
Fuel tax credit: $0 $0 Review
Other payments: $0 $0 Review</p>

<p>When I was finished with everything this is a Summary of my Federal Return, I see the 4,000 Adjustments, I am confused on what that could mean.,</p>

<p>2012 Federal Tax Summary -
Income: $10,981
Adjustments: $4,000
Adjusted Gross Income: $6,981
Deductions: $5,950
Exemptions: $3,800
Taxable Income: $0
Tax: $0
Alternative Minimum Tax: $0
Credits: $0
Other Taxes: $0
Payments: $572
Underpayment Penalty: $0</p>

<p>You cannot claim both the Tuition and fees deduction and American opportunity credit.</p>

<p>You could tell TAXACT to claim AOTC instead the Tuition and fees deduction.</p>

<p>I’m guessing that TAXACT thinks you receive more tax benefits from the Tuition and fees deduction than the American opportunity credit.</p>

<p>When I did what you said, this is what it changed to</p>

<p>Here’s a summary of the higher education tax benefit on your federal return. Your American opportunity credit has been limited. Learn More
Tuition and fees deduction: $0
Lifetime learning credit: $0
American opportunity credit: $124
Refundable part of AOC: $0</p>

<p>But when I did the Tuition and fees deduction is showed 4,000.</p>

<p>I figured out why it says $124, it says</p>

<p>Your tax liability is less than the nonrefundable part of the credit. A nonrefundable credit can only be claimed up to the amount of tax liability on the return.</p>

<p>What does that mean?</p>

<p>I also payed 2,992.00 out of pocket cost for that year, on top of my loans. I do not understand how I do not qualify.</p>

<p>Anybody else think there is a mistake? Or am I just incorrect</p>

<p>The AOC has two parts, the non-refundable part reduces your tax owed, in your case to 0. The refundable part should increase your refund.</p>

<p>A credit is generally better than a deduction. A credit is dollar for dollar off taxes owed. A deduction just reduces your AGI before taxes are figured.</p>

<p>Is your refund the same either way, with the credit and with the deduction? I’m assuming $572.</p>

<p>At this point I don’t know why TaxAct didn’t give you the refundable part of the AOC.</p>

<p>

TAXACT thinks you’re not entitle to the Refundable part of AOC.
Is there a checkbox that you forgot to check/uncheck?</p>

<p>See [Publication</a> 970 (2011), Tax Benefits for Education](<a href=“http://www.irs.gov/publications/p970/ch02.html#en_US_2011_publink1000211799]Publication”>http://www.irs.gov/publications/p970/ch02.html#en_US_2011_publink1000211799)
Please change 2011 to 2012

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<p>So from here, anybody have any ideas on something I could have done wrong?</p>

<p>My parents are still alive, that means I am not entitled to it I am guessing?</p>

<p>If that is the case…I cant get any of my 2,992.00 out of pocket cost back?</p>

<p>Look at your refund. It looks like you have $124 tax due before credits. You get this back as the refundable portion of the AOC, reducing your tax to $0. You should then get your $572, and then further down on the form, you get another $1000 back.</p>

<p>Does it say you get a refund of $572 or $1572? On the 1040 the refundable part show in a section called payments with other refundable credits</p>

<p>Are you using the online version or boxed software? If the boxed software, have you applied all updates? You are qualifying, it’s just not calculating the refundable portion of the credit for some reason.</p>

<p>

Open the form 8863, there is a box at the end of line 7.
You should uncheck or find a way to uncheck that box</p>