<p>I use turbo tax, but have not purchased the 2011 version yet. I wondered if I will be able to write off any of my son's tuition /fees. This is our oldest son and it is his first year at college, so I am not sure if turbo tax will walk me thru this or not.</p>
<p>I also was not sure if I can still claim my son as a dependent. We live in CA and he is going to school in AZ. </p>
<p>my wife and I are paying 100% of all costs for him this year.</p>
<p>Look at the Financial Aid forum - lots of info there. I am not a tax professional - but IMO - yes - you can still claim him as a dependent as long as he is a full-time student. Look for the $2500 American Opportunity tax credit - that is the best one to use.</p>
<p>Correct. If you use a tax prep software - there will be a section that asks you about credits you believe you are eligible for - so just check off that you have a kid in college. It’s Form 8863. You can take $2500 per child - so if you have two in college this year or next year - you can potentially have a $5000 tax credit. This is the last year (2012) for this credit - unless Congress extends it again.</p>
<p>Also - rules vary if you used funds from a 529 account. I do not have that and am not familiar with it. So - if you used 529 funds - more investigation is needed.</p>
<p>That’s the beauty of college tuition. You use post-tax money to pay for it, and then you can barely get a deduction/credit either. Marvelous, simply marvelous.</p>
<p>You should write son off a letter that he should load up on student loans because the interest is tax deductible from dollar one. Interest rates are currently low.</p>
<p>If you are sending kid to OOS, and then you in the 25-28% marginal bracket and if you live in CA, you may be in the 32% bracket. Load up on PLUS and get the interest credit, currently slightly below 8.5%. And with interest deduction, the effective rate is 6.4% (25% bracket).</p>
<p>turbo tax will walk you through it. You can declare son as a dependent as long as he doesn’t also do a return and claim himself. you should receive a form from sons school. you enter those figures in turbo tax and it will figure out the best deduction.</p>
<p>You do not “write off” your son’s tuition. There are some tuition tax credits that you will be get a small portion of with our income. Believe me, it won’t come CLOSE to the costs you are paying…but every penny counts.</p>
<p>I think it’s an eye opener to many parents to discover that they can’t ‘write-off’ all of the tuition, or even better, all of the college costs (tuition/fees, housing, meal plan, etc.). You can shoot for various tax credits, which are fairly paltry relative to the cost of college usually, as long as your income is below a certain level but contrary to popular belief, those who earn more don’t get even these tax credits.</p>
<p>So you can deduct interest of your son student loans? Or are you suggesting that the son can deduct the interest in his tax return. But wait, my son does not make enough to pay taxes. Either way, you still pay the interest, so wouldn’t deduction just save only about 30% out of the interest you pay?</p>
<p>That is correct.
Since you are a full pay family, perhaps you can find other ways to use the cash? Perhaps even to pay off the higher interest loans, or even the student loan when he’s done. </p>
<p>Until Congress is still funding unlimited PLUS loans, that is. It is a strategy. Some may find this strategy not a good one. Others may find it an excellent use of credit. Be sure you understand.</p>
<p>OK, I know it’s late, but I’ve just done a draft version of our 1040. Happykid has a scholarship that covers most of her tuition and fees, and in 2011 we paid about $1,400 for the extra fees plus books and materials. It looks to me like we can claim all of that with the AOC. Did I do the math right?</p>
<p>AGI is about 85k, filing as married. And yes, I was doing this with a bunch of loose papers because I’m too cheap to pay for Turbotax.</p>
<p>Tuition is potentially deductible, but generally the American Opportunity Credit is a better choice.</p>
<p>[Internal</a> Revenue Service](<a href=“http://www.irs.gov%5DInternal”>http://www.irs.gov) is a really good source for this type of information, and there have been some excellent threads recently on the CC Financial Aid forum. There are some very helpful parents on that thread who have “been there, done that”.</p>
<p>This is a link to the tax benefits for education section at IRS.gov.</p>