I’m required to file my own taxes this year over scholarships/grants in excess of academic charges. I have no other type of income to declare, such as work earnings. I might not be able to meet personally with my preparer, since I can only go home during spring break & they may/may not be available during that week. In this case, I’d have to self-prepare them/use a tax software. If it comes to this, which software would you recommend? What are the possible cons to this situation? Any legal implications? Thanks.
The software is very easy to use. I did my daughter’s last year and all she had was scholarship income.
However, if you are a dependent, you’ll need information from your parents’ return. They have to do their return first because you have to enter their taxable income and tax paid.
If your parents have a tax preparer, he might do your return for free or a small fee. It’s really easy if this is all you have.
Parents’ return will be done in February, so not a problem. I was talking about their tax preparer on the post, so hopefully the software is enough. How effective is it in terms of itemized deductions?
You can do a return with itemized deductions on the software, but why would you? You said you have nothing but the scholarships, no other income. I assume you don’t own a house. How will you itemize and have more to deduct than the standard $6300 deduction?
Are you asking about itemizing QEE? You don’t have to. If I recall, the software asks you what’s on the 1098T, then asks if that is correct or if you have other scholarships not reported on it and what your books and supplies cost. Then it lumps them all together.
Yes, I meant the QEE, thanks. Is this Turbotax btw? And does using software vs a preparer increase chances of audit?
For my kids I used TaxAct, for me I used turbotax. No reason, just habit.
Using tax software doesn’t increase your chances of an audit. Taking certain deductions increases your chances, like Hobby loss, or a home office deduction, certain schedules increase your chances, but your chances are very low to be audited anyway as you are low income. Doesnt mean they won’t correct something.
Great. As for how to claim certain awards…
For awards intended for spring 2015, but credited towards the school in Dec 2014, I am including in tax year 15.
For awards intended for spring 2016 but credited towards the school in Dec. 15, I’m including in tax year 16.
However, outside awards credited to me directly (bank account deposit) in 2015, but meant for the 15-16 academic year, I am claiming entirely in 15 taxes.
Is this approach correct? Thanks.
You don’t need to meet with a tax preparer in person. It can be easiest to use your parent’s. Especially since you probably need to include Form 8615.
Both TurboTax and TaxAct offer free tax return preparation on the Web for simple returns like yours.
Google it.
^F8615 is not free for TurboTax See https://turbotax.intuit.com/personal-taxes/online/free-edition.jsp
I think “certain child” requires to attach the form if unearned incomes (includes taxable scholarships not reported on W2) > $2100
https://turbotax.intuit.com/taxfreedom
Turbotax offers the Turbotax Freedom Edition. Prepare and e-file return for free if you earned under $31,000 AGI, active duty military under $62,000 AGI or qualify for Earned Income Credit.
So you should be able to do your taxes with this. But you have to sign in again from the taxfreedom page for it to let you do the return for free.
Some of the free basic programs out there don’t let you file 1040, only 1040 EZ or 1040 A. You need the 1040 because of form 8615.
last year my daughter didn’t need the 1040 for the 8615. Used TaxAct for free. Haven’t done this year’s yet, but haven’t heard it is any different.
Yes, 8615 filers can still use the 1040A. For OP: you can access free tax prep software from the IRS website.
https://www.irs.gov/uac/Free-File:-Do-Your-Federal-Taxes-for-Free
I’m sorry. I was wrong. I thought that the 1040 has to be filed. Out tax software selected the 1040, but I did not take into consideration that the reason was my D’s schedule C income.
^ So I can file the 1040A even if my parents file the 1040?
Yes.