In the "You Got It" weekly series, we will answer a question of our customers found on Facebook, Twitter, Blog and TaxACT around the web
issue :.
I am a graduate student and I get almost full remission of tuition and fees my university as part of my compensation for my teaching assistantship. my T-1098 shows that I "paid" $ 3,500 in tuition fees in 2014, but received $ 3,400 in tuition remission. in fact, the University " paid "itself directly, the money never came through my hands, and I have to pay the extra ~ $ 100 in costs out of pocket.
When I entered the info of my 1098-T, he said I qualified for the main student tax credits. Apparently he added remission (listed in the Fellowship box on the 1098-T) to my income, and I given credit based tuition I paid. I anticipated that delivery and tuition cancel out, leaving only $ 100 to use in the calculation of credits.
I wonder if this is a mistake, or do I claim rightly these tax credits, which add up to over $ 00
answer
you might be able to apply for an education tax credit if you received a reduction of tuition fees as part of your remuneration for teaching or research assistantship.
Although you did not pay out of pocket fees, you are treated as having paid for the purpose of the education credit.
tuition reductions are the benefits of education generally tax free.
you do not include the amount of your income, and you can not use the amount to apply for an education credit.
However, the reduction of fees that represent payment for services should be included in your income.
Because you have to pay tax on this benefit, it is treated as if you received it as part of your salary and paid tuition at school.
You may need to check with your school to determine if reducing tuition does represent payment for services.
question about the American credit opportunity
Looking to file my taxes and it is claiming that I am not eligible for the American Opportunity credit because my tax liability is less than the credit itself (because I made a little less than $ 5,000 in wages last year and owe no taxes, I guess).
However, I was told I could get $ 1,000 back independently. Why I do not get this money?
Instead, he gave me the standard deduction of $ 4,000 for tuition, and my taxable income comes out to about $ 700 instead of almost $ 5,000.
Is there something I am missing here or I misunderstood
answer:.
The American opportunity credit (AOC) is composed of two separate votes - a non-refundable credit and a refundable credit
The non-refundable credit can offset up $ 1500 tax, but it can not be used to give you an additional refund if your tax is zero. The refundable credit can increase your refund up to $ 1,000 if you have or not a tax liability.
If you meet the basic AOC requirements, you are eligible for non-refundable credit.
basic requirements are that you were enrolled in a qualifying school at least half time in a program leading to a degree, you have not completed the first four years of school, and you have not claimed the AOC over 3 previous statements.
If you are under 24, you must meet additional qualification to apply for the refundable credit.
to be eligible for the refundable tax credit, one of the following must apply to you:
- you provided at least half of your own support or
- both parents were deceased at the end of the year, or
- you file a joint return with your spouse.
TaxACT you ask any relevant questions to determine what benefits the education you can ask your return.
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