How to Claim Tuition on Taxes
Most taxpayers who are in college or paying the education expenses of a family member are eligible to claim a tuition credit on their income tax return. Generally, taxpayers who fall into one of the categories outlined above qualify for the Hope Credit or the Lifetime Learning Credit. Both credits allow deductions for tuition expenses, and have corresponding IRS forms that are reasonably easy to complete.
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Instructions
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Know the credit limits. In order to qualify for the Hope Credit or the Lifetime Learning Credit, you must be in school yourself, or subsidizing the expenses of an immediate family member (spouse or dependent) who is in school at least half time. If you meet this qualification, you are eligible to claim book and tuition expenses on your tax return. You are not, however, eligible to claim monies spent on travel, electronics or any other miscellaneous, school-related expenses.
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Be in the first two years of college. If the student for whom you are claiming a tuition credit on your taxes is in the first two years of college and pursuing an undergraduate degree, you qualify for the Hope Credit, although there was no Hope Credit offered in 2010. To claim this credit, complete IRS Form 8863 and attach it to your Form 1040. The Hope Credit allowance is 100 percent of the first $1,200 in expenses, and 50 percent of the second $1,200.
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Be beyond the first two years of college. If the student for whom you are claiming a tuition credit is going to school, but is not in the first two years of postsecondary education or is not pursuing an undergraduate degree, you qualify for the Lifetime Learning Credit. In order to claim the Lifetime Learning Credit, complete Form 8863 and attach it to your Form 1040. The allowance for the Lifetime Learning Credit is 20 percent of the first $10,000, with a maximum of $2,000.
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Tips & Warnings
Both the Hope and Lifetime Learning credits begin to phase out when the taxpayer's income reaches $48,000 (or $96,000 if Married Filing Jointly).
Be advised that you cannot take the tuition and fees deduction if your filing status was married filing separately for the tax year in which you are filing, or if the student for whom you are taking the credit is a convicted felon. In addition, you cannot take both a Hope Credit and a Lifetime Learning Credit for the same student, or claim expenses that were paid by another.
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