<p>My parents live and earn income outside U.S, and therefore file foreign tax return.
I am a U.S citizen, and a sophomore in College </p>
<p>I filed the FAFSA last year, sending school's requested documents. I received financial aid last year.</p>
<p>For this year, I have a question about parent's additional financial information?
what is educational credit and do my parents need to find out about it?</p>
<p>Also, I worked last year, so I need to file tax. When w-2 forms are sent home, and when I finish filing, I can go back to FAFSA and make corrections right?</p>
<p>Thank you... I have no idea how filing tax and returning works... and I have no one to ask since my parents don't file tax and not a lot of people that I know do too.</p>
<p>Educational credit probably refers to tax credits you can get for education costs. For instance in the first 2 years of college there is a credit called the Hope tax credit that can reduce a persons taxes by up to $1650. If your parent's do not file a US tax return they will not be eligible for any education tax credits. </p>
<p>If you file taxes as an independent and earned enough you may be eligible for the tax credits yourself. Make sure you check it out.</p>
<p>Yes you can file FAFSA and go back and make corrections.</p>
<p>If your income etc is fairly low and simple you can use the IRS freefile. It gives links to various online software providers which will walk you through the process. We used the turbotax free file last year.
Free</a> File Home - Your Link to Free Federal Online Filing</p>
<p>If your parents are US citizens or permanent residents (green card) they should be filing US tax returns every year. Most likely they won't owe a cent in taxes because of credit for the foreign taxes they are paying and because of the foreign income exclusions etc. Happydad and I were in Venezuela for parts of 8 tax years and while the paperwork can be a bit time consuming it is not difficult.</p>
<p>You can read all about US federal taxes at Internal</a> Revenue Service</p>
<p>Since you worked in the US last year, you may also need to file a state and/or local tax return.</p>
<p>Good luck!</p>