Deducting Education Expenses for an Adult Child:
Deducting Education Expenses for an Adult Child:
An adult child who is not a dependent has returned to graduate school. My wife and I are paying for his tuition and have made payments directly to his MBA program. It was an informal understanding from talking to friends that we would be able to deduct $4,000 of these expenses since the tuition was paid directly. IRS Pub. # 970 refers to a variety of deductible education expenses, but it appears that the child must be a dependent to qualify. Is this accurate, and would a claimed deduction be disallowed? It would not make a difference in our choice to pay the tuition, but it would be nice to be able to claim the deduction.
Tim
Tim
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Re: Deducting Education Expenses for an Adult Child:
U R kidding, of course? He's either an adult, or a child (unless he's disabled, and you are providing for a portion/all of his expenses).Nowizard wrote:My wife and I are paying for his tuition and have made payments directly to his MBA program.
Why do you think you should get a deduction to "enable" him?
Just wondering...
- Ron
What?
The belief was that there was a regulation related to the Lifetime Learning issues or another, related, issue. I think your comment about "enabling" is inappropriate in that you do not know the circumstances of a family and are certainly not qualified to make a diagnosis.
Tim
Tim
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Re: What?
Actually, you are incorrect in your assumption. I am (for one) the father of an "adult child". One who is collecting SSD for his condition of being a high performing autistic.Nowizard wrote:The belief was that there was a regulation related to the Lifetime Learning issues or another, related, issue. I think your comment about "enabling" is inappropriate in that you do not know the circumstances of a family and are certainly not qualified to make a diagnosis.
Tim
And yes, he does have a degree but unfortunately not able to hold a job due to his inability to hold a constructive dialogue, so I am well aware of the conditions (both federal and state) for support.
- Ron
Oh, me!
Ron: The comment was about "enabling," not your accuracy in answering the question about deductions. You do not know the circumstances of our family in regard to why we would pay tuition for an adult child, though you do have reason to know the regulations allowing deductions for expenses benefitting one. The context you provided regarding your situation does help to explain the sarcastic response. Best wishes to you and your son!
Tim
Tim
You can claim an education credit only if you can claim the student as your dependent for whom you can claim an exemption. That does not appear to be the case. However, the student may be able claim the Lifelong Learning Credit.
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Tim,
Check this out. This has helped me answer some of my own questions concerning my son's college expenses.
alan
http://www.irs.gov/pub/irs-pdf/p970.pdf
Check this out. This has helped me answer some of my own questions concerning my son's college expenses.
alan
http://www.irs.gov/pub/irs-pdf/p970.pdf
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Sorry Jack, your understanding is incorrect. In order to claim education tax benefits, the eligible student must be claimed as a dependent on your tax return.Benn1950 wrote:It has always been my understanding that you must be eligible to claim the student as a dependent in order to claim the tuition deduction. You do not have to claim the student as a dependent, merely be eligible to claim him/her. Jack
What you've heard is the other side of the coin. If a parent is eligible to claim the student as a dependent but chooses not to do so, then the student can claim such benefits on his/her own tax return. In order for this to happen, the parent has to be eligible to claim the student as a dependent first.
This is among the lesser known and somewhat confusing tax loopholes.
Unfortunately, I've read Pub 970 a few times. I believe Huey is correct.
In fact, there wording in the NY State tax form that essentially says, "If you are eligible to claim a child as your dependent but you elect not to (to allow them to claim the federal education credits), you may optionally still claim the child as a dependent on your state taxes."
So yeah, the child has to be a dependent for the parents to claim the credit. And there is an income limit for the tax credits (which is why the parents elect not to claim the dependent, so at least the child -- who presumably has a lower income -- could do so).
Bob
In fact, there wording in the NY State tax form that essentially says, "If you are eligible to claim a child as your dependent but you elect not to (to allow them to claim the federal education credits), you may optionally still claim the child as a dependent on your state taxes."
So yeah, the child has to be a dependent for the parents to claim the credit. And there is an income limit for the tax credits (which is why the parents elect not to claim the dependent, so at least the child -- who presumably has a lower income -- could do so).
Bob
Re: Deducting Education Expenses for an Adult Child:
If he has taxable income (line 43 of form 1040), and you are paying the tuition for him and he is not your dependent, he would be eligible to benefit from the Tuition and Fee deduction or the LLC. See p. 39 of Pub 970.Nowizard wrote: It would not make a difference in our choice to pay the tuition, but it would be nice to be able to claim the deduction.
Tim
This may not help you, but it could give the student a bit of a financial assistance.
BruceM
Your child should be able to take a deduction for the tuition.
I bet the 1098T will come to him (the one enrolled), not to you, even though you paid directly.
That is what happens with my daughter. She graduated in May 2008 and I am unable to claim her as a dependent for the first time. But she will be able to take the deduction for the tuition I paid before May, even though I paid the bill.
I bet the 1098T will come to him (the one enrolled), not to you, even though you paid directly.
That is what happens with my daughter. She graduated in May 2008 and I am unable to claim her as a dependent for the first time. But she will be able to take the deduction for the tuition I paid before May, even though I paid the bill.
Thank You Very Much!
The responses are appreciated. I have read Pub. 970. I would hope that the deduction, when taken by my son, would be above the line and not require itemization. Students don't typically have sufficient numbers of deductions to itemize.
Tim
Tim
Have you got a source for that?What you've heard is the other side of the coin. If a parent is eligible to claim the student as a dependent but chooses not to do so, then the student can claim such benefits on his/her own tax return. In order for this to happen, the parent has to be eligible to claim the student as a dependent first
I don't see that in Pub 970. There is a rule that a student cannot take the tuition deduction if they qualify as someone's dependent even if they were not claimed as a deduction.
Read the Pub 970 again! See page 23.tadamsmar wrote:Have you got a source for that?
I don't see that in Pub 970. There is a rule that a student cannot take the tuition deduction if they qualify as someone's dependent even if they were not claimed as a deduction.
Your understanding is correct in general. That is, if a taxpayer can be claimed as a dependent on another person's returns, he cannot claim that he is not a dependent on his own tax return. However, the higher education tax benefits do have this loophole that was put in the code by those with lobbying power.
Please quote the 970 to support your claim. I can't figure out what you are talking about.HueyLD wrote:Read the Pub 970 again! See page 23.tadamsmar wrote:Have you got a source for that?
I don't see that in Pub 970. There is a rule that a student cannot take the tuition deduction if they qualify as someone's dependent even if they were not claimed as a deduction.
Your understanding is correct in general. That is, if a taxpayer can be claimed as a dependent on another person's returns, he cannot claim that he is not a dependent on his own tax return. However, the higher education tax benefits do have this loophole that was put in the code by those with lobbying power.
Thanks, Again!
The responses are helpful. It is just as desirable for him to have the deduction since it helps him, even though his bracket is smaller than ours. It will not be when he completes his MBA at an excellent school based on the offer accompanying a summer internship he received today.
Tim
Tim
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