I don’t get any financial aid and I pay my tuition completely out of pocket. Is it true that I can get that money back in the form of a tax credit at the end of the year? How does that work exactly? Does anyone have any experience in doing something like this?
See IRS Publication 970 for more information.
Do your parents claim you as a dependent on their tax return?
Is your earned income more than half of your support?
You will NOT get all the money you pay as a tax credit.
Maybe not in OP’s case, depending on how much his/her qualified expenses are, but with the American Opportunity Credit, it’s possible for the credit to cover the full cost of tuition.
How? You only get $2500 of AOTC for $4000 qualified educational expenses.
If a student graduated high school in May/June and then attended one semester of community college in fall and the tuition was $2000 or less, then the credit could cover the full cost of tuition.
Right. Also, you can get the AOTC as a half-time student, which would obviously decrease your expenses, and the first $2,000 of the credit is given on a dollar-for-dollar basis (unlike the Lifetime Learning Credit, which is 10% of qualified expenses up to a maximum credit of $2,000).
My parents don’t claim me and I support myself completely. If I use TurboTax to file my taxes will they have a section there where I can say how much I have paid in tuition? I haven’t really filed taxes before so I’m kind of new to all this.
Do you provide over half of your own support through job earnings?
For example, if your tuition, room, board, health insurance, transportation, books, clothes, entertainment, shampoo and toothpaste cost $30,000 per year; are you earning from a job $15,001 per year? Where does the money come from that you use to support yourself?