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1040x 2013 6. 1040x 2013   Tuition and Fees Deduction Table of Contents IntroductionWhat is the tax benefit of the tuition and fees deduction. 1040x 2013 Can You Claim the DeductionWho Can Claim the Deduction Who Cannot Claim the Deduction What Expenses QualifyQualified Education Expenses No Double Benefit Allowed Expenses That Do Not Qualify Who Is an Eligible Student Who Can Claim a Dependent's Expenses Figuring the DeductionEffect of the Amount of Your Income on the Amount of Your Deduction Claiming the Deduction Illustrated Example Introduction You may be able to deduct qualified education expenses paid during the year for yourself, your spouse, or your dependent(s). 1040x 2013 You cannot claim this deduction if your filing status is married filing separately or if another person can claim an exemption for you as a dependent on his or her tax return. 1040x 2013 The qualified expenses must be for higher education, as explained later under Qualified Education Expenses . 1040x 2013 What is the tax benefit of the tuition and fees deduction. 1040x 2013   The tuition and fees deduction can reduce the amount of your income subject to tax by up to $4,000. 1040x 2013   This deduction is taken as an adjustment to income. 1040x 2013 This means you can claim this deduction even if you do not itemize deductions on Schedule A (Form 1040). 1040x 2013 This deduction may be beneficial to you if you do not qualify for the American opportunity or lifetime learning credits. 1040x 2013 You can choose the education benefit that will give you the lowest tax. 1040x 2013 You may want to compare the tuition and fees deduction to the education credits. 1040x 2013 See chapter 2, American Opportunity Credit and chapter 3, Lifetime Learning Credit for more information on the education credits. 1040x 2013 Table 6-1. 1040x 2013 Tuition and Fees Deduction at a Glance summarizes the features of the tuition and fees deduction. 1040x 2013 Can You Claim the Deduction The following rules will help you determine if you can claim the tuition and fees deduction. 1040x 2013 Who Can Claim the Deduction Generally, you can claim the tuition and fees deduction if all three of the following requirements are met. 1040x 2013 You pay qualified education expenses of higher education. 1040x 2013 You pay the education expenses for an eligible student. 1040x 2013 The eligible student is yourself, your spouse, or your dependent for whom you claim an exemption on your tax return. 1040x 2013 The term “qualified education expenses” is defined later under Qualified Education Expenses . 1040x 2013 “Eligible student” is defined later under Who Is an Eligible Student . 1040x 2013 For more information on claiming the deduction for a dependent, see Who Can Claim a Dependent's Expenses , later. 1040x 2013 Table 6-1. 1040x 2013 Tuition and Fees Deduction at a Glance Do not rely on this table alone. 1040x 2013 Refer to the text for complete details. 1040x 2013 Question Answer What is the maximum benefit? You can reduce your income subject to tax by up to $4,000. 1040x 2013 What is the limit on modified adjusted gross income (MAGI)? $160,000 if married filing a joint return; $80,000 if single, head of household, or qualifying widow(er). 1040x 2013 Where is the deduction taken? As an adjustment to income on  Form 1040 or Form 1040A. 1040x 2013 For whom must the expenses be paid? A student enrolled in an eligible educational institution who is either: •you,  •your spouse, or  •your dependent for whom you claim an exemption. 1040x 2013 What tuition and fees are deductible? Tuition and fees required for enrollment or attendance at an eligible postsecondary educational institution, but not including personal, living, or family expenses, such as room and board. 1040x 2013 Who Cannot Claim the Deduction You cannot claim the tuition and fees deduction if any of the following apply. 1040x 2013 Your filing status is married filing separately. 1040x 2013 Another person can claim an exemption for you as a dependent on his or her tax return. 1040x 2013 You cannot take the deduction even if the other person does not actually claim that exemption. 1040x 2013 Your modified adjusted gross income (MAGI) is more than $80,000 ($160,000 if filing a joint return). 1040x 2013 You (or your spouse) were a nonresident alien for any part of 2013 and the nonresident alien did not elect to be treated as a resident alien for tax purposes. 1040x 2013 More information on nonresident aliens can be found in Publication 519. 1040x 2013 What Expenses Qualify The tuition and fees deduction is based on qualified education expenses you pay for yourself, your spouse, or a dependent for whom you claim an exemption on your tax return. 1040x 2013 Generally, the deduction is allowed for qualified education expenses paid in 2013 in connection with enrollment at an institution of higher education during 2013 or for an academic period beginning in 2013 or in the first 3 months of 2014. 1040x 2013 For example, if you paid $1,500 in December 2013 for qualified tuition for the spring 2014 semester beginning in January 2014, you may be able to use that $1,500 in figuring your 2013 deduction. 1040x 2013 Academic period. 1040x 2013   An academic period includes a semester, trimester, quarter, or other period of study (such as a summer school session) as reasonably determined by an educational institution. 1040x 2013 In the case of an educational institution that uses credit hours or clock hours and does not have academic terms, each payment period can be treated as an academic period. 1040x 2013 Paid with borrowed funds. 1040x 2013   You can claim a tuition and fees deduction for qualified education expenses paid with the proceeds of a loan. 1040x 2013 Use the expenses to figure the deduction for the year in which the expenses are paid, not the year in which the loan is repaid. 1040x 2013 Treat loan disbursements sent directly to the educational institution as paid on the date the institution credits the student's account. 1040x 2013 Student withdraws from class(es). 1040x 2013   You can claim a tuition and fees deduction for qualified education expenses not refunded when a student withdraws. 1040x 2013 Qualified Education Expenses For purposes of the tuition and fees deduction, qualified education expenses are tuition and certain related expenses required for enrollment or attendance at an eligible educational institution. 1040x 2013 Eligible educational institution. 1040x 2013   An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U. 1040x 2013 S. 1040x 2013 Department of Education. 1040x 2013 It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. 1040x 2013 The educational institution should be able to tell you if it is an eligible educational institution. 1040x 2013   Certain educational institutions located outside the United States also participate in the U. 1040x 2013 S. 1040x 2013 Department of Education's Federal Student Aid (FSA) programs. 1040x 2013 Related expenses. 1040x 2013   Student-activity fees and expenses for course-related books, supplies, and equipment are included in qualified education expenses only if the fees and expenses must be paid to the institution as a condition of enrollment or attendance. 1040x 2013 Prepaid expenses. 1040x 2013   Qualified education expenses paid in 2013 for an academic period that begins in the first three months of 2014 can be used in figuring an education credit for 2013 only. 1040x 2013 See Academic period , earlier. 1040x 2013 For example, you pay $2,000 in December 2013 for qualified tuition for the 2014 winter quarter that begins in January 2014, you can use that $2,000 in figuring an education credit for 2013 only (if you meet all the other requirements). 1040x 2013 You cannot use any amount you paid in 2012 or 2014 to figure the qualified education expenses you use to figure your 2013 education credit(s). 1040x 2013 In the following examples, assume that each student is an eligible student and each college or university an eligible educational institution. 1040x 2013 Example 1. 1040x 2013 Jackson is a sophomore in University V's degree program in dentistry. 1040x 2013 This year, in addition to tuition, he is required to pay a fee to the university for the rental of the dental equipment he will use in this program. 1040x 2013 Because the equipment rental fee must be paid to University V for enrollment and attendance, Jackson's equipment rental fee is a qualified education expense. 1040x 2013 Example 2. 1040x 2013 Donna and Charles, both first-year students at College W, are required to have certain books and other reading materials to use in their mandatory first-year classes. 1040x 2013 The college has no policy about how students should obtain these materials, but any student who purchases them from College W's bookstore will receive a bill directly from the college. 1040x 2013 Charles bought his books from a friend, so what he paid for them is not a qualified education expense. 1040x 2013 Donna bought hers at College W's bookstore. 1040x 2013 Although Donna paid College W directly for her first-year books and materials, her payment is not a qualified education expense because the books and materials are not required to be purchased from College W for enrollment or attendance at the institution. 1040x 2013 Example 3. 1040x 2013 When Marci enrolled at College X for her freshman year, she had to pay a separate student activity fee in addition to her tuition. 1040x 2013 This activity fee is required of all students, and is used solely to fund on-campus organizations and activities run by students, such as the student newspaper and the student government. 1040x 2013 No portion of the fee covers personal expenses. 1040x 2013 Although labeled as a student activity fee, the fee is required for Marci's enrollment and attendance at College X. 1040x 2013 Therefore, it is a qualified expense. 1040x 2013 No Double Benefit Allowed You cannot do any of the following. 1040x 2013 Deduct qualified education expenses you deduct under any other provision of the law, for example, as a business expense. 1040x 2013 Deduct qualified education expenses for a student on your income tax return if you or anyone else claims an American opportunity or lifetime learning credit for that same student in the same year. 1040x 2013 Deduct qualified education expenses that have been used to figure the tax-free portion of a distribution from a Coverdell education savings account (ESA) or a qualified tuition program (QTP). 1040x 2013 For a QTP, this applies only to the amount of tax-free earnings that were distributed, not to the recovery of contributions to the program. 1040x 2013 See Coordination With Tuition and Fees Deduction in chapter 8, Qualified Tuition Program, later. 1040x 2013 Deduct qualified education expenses that have been paid with tax-free interest on U. 1040x 2013 S. 1040x 2013 savings bonds (Form 8815). 1040x 2013 See Figuring the Tax-Free Amount in chapter 10, Education Savings Bond Program, later. 1040x 2013 Deduct qualified education expenses that have been paid with tax-free educational assistance, such as a scholarship, grant, or assistance provided by an employer. 1040x 2013 See the following section on Adjustments to Qualified Education Expenses. 1040x 2013 Adjustments to Qualified Education Expenses For each student, reduce the qualified education expenses paid by or on behalf of that student under the following rules. 1040x 2013 The result is the amount of adjusted qualified education expenses for each student. 1040x 2013 You must also reduce qualified education expenses by the other amounts referred to in No Double Benefit Allowed , earlier. 1040x 2013 Tax-free educational assistance. 1040x 2013   For tax-free educational assistance received in 2013, reduce the qualified educational expenses for each academic period by the amount of tax-free educational assistance allocable to that academic period. 1040x 2013 See Academic period , earlier. 1040x 2013   Some tax-free educational assistance received after 2013 may be treated as a refund of qualified education expenses paid in 2013. 1040x 2013 This tax-free educational assistance is any tax-free educational assistance received by you or anyone else after 2013 for qualified education expenses paid on behalf of a student in 2013 (or attributable to enrollment at an eligible educational institution during 2013). 1040x 2013   If this tax-free educational assistance is received after 2013 but before you file your 2013 income tax return, see Refunds received after 2013 but before your income tax return is filed , later. 1040x 2013 If this tax-free educational assistance is received after 2013 and after you file your 2013 income tax return, see Refunds received after 2013 and after your income tax return is filed , later. 1040x 2013   This tax-free education assistance includes: The tax-free part of scholarships and fellowships (see Tax-Free Scholarships and Fellowships in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), Pell grants (see Pell Grants and Other Title IV Need-Based Education Grants in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), Employer-provided educational assistance (see chapter 11, Employer-Provided Educational Assistance ), Veterans' educational assistance (see Veterans' Benefits in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions), and Any other nontaxable (tax-free) payments (other than gifts or inheritances) received as educational assistance. 1040x 2013 Generally, any scholarship or fellowship is treated as tax free. 1040x 2013 However, a scholarship or fellowship is not treated as tax free to the extent the student includes it in gross income (if the student is required to file a tax return for the year the scholarship or fellowship is received) and either of the following is true. 1040x 2013 The scholarship or fellowship (or any part of it) must be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. 1040x 2013 The scholarship or fellowship (or any part of it) may be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. 1040x 2013 You may be able to increase the combined value of an education credit and certain educational assistance if the student includes some or all of the educational assistance in income in the year it is received. 1040x 2013 For details, see Adjustments to Qualified Education Expenses in chapters 2 and 3. 1040x 2013 Refunds. 1040x 2013   A refund of qualified education expenses may reduce adjusted qualified education expenses for the tax year or require repayment (recapture) of a credit claimed in an earlier year. 1040x 2013 Some tax-free educational assistance received after 2013 may be treated as a refund. 1040x 2013 See Tax-free educational assistance , earlier. 1040x 2013 Refunds received in 2013. 1040x 2013   For each student, figure the adjusted qualified education expenses for 2013 by adding all the qualified education expenses for 2013 and subtracting any refunds of those expenses received from the eligible educational institution during 2013. 1040x 2013 Refunds received after 2013 but before your income tax return is filed. 1040x 2013   If anyone receives a refund after 2013 of qualified education expenses paid on behalf of a student in 2013 and the refund is paid before you file an income tax return for 2013, the amount of qualified education expenses for 2013 is reduced by the amount of the refund. 1040x 2013 Refunds received after 2013 and after your income tax return is filed. 1040x 2013   If anyone receives a refund after 2013 of qualified education expenses paid on behalf of a student in 2013 and the refund is paid after you file an income tax return for 2013, you may need to repay some or all of the credit. 1040x 2013 See Credit recapture , later. 1040x 2013 Coordination with Coverdell education savings accounts and qualified tuition programs. 1040x 2013   Reduce your qualified education expenses by any qualified education expenses used to figure the exclusion from gross income of (a) interest received under an education savings bond program, or (b) any distribution from a Coverdell education savings account or qualified tuition program (QTP). 1040x 2013 For a QTP, this applies only to the amount of tax-free earnings that were distributed, not to the recovery of contributions to the program. 1040x 2013 Credit recapture. 1040x 2013    If any tax-free educational assistance for the qualified education expenses paid in 2013 or any refund of your qualified education expenses paid in 2013 is received after you file your 2013 income tax return, you must recapture (repay) any excess credit. 1040x 2013 You do this by refiguring the amount of your adjusted qualified education expenses for 2013 by reducing that amount by the amount of the refund or tax-free educational assistance. 1040x 2013 You then refigure your education credit(s) for 2013 and figure the amount by which your 2013 tax liability would have increased if you had claimed the refigured credit(s). 1040x 2013 Include that amount as an additional tax for the year the refund or tax-free assistance was received. 1040x 2013 Example. 1040x 2013   You paid $3,500 of qualified education expenses in December 2013, and your child began college in January 2014. 1040x 2013 You claimed $3,500 as the tuition and fees deduction on your 2013 income tax return. 1040x 2013 The reduction reduced your taxable income by $3,500. 1040x 2013 Also, you claimed no tax credits in 2013. 1040x 2013 Your child withdrew from two classes and you received a refund of $2,000 in 2014 after you filed your 2013 tax return. 1040x 2013 Refigure your 2013 tuition and fees deduction using $1,500 of qualified education expense instead of the $3,500. 1040x 2013 The refigured tuition and fees deduction is $1,500. 1040x 2013 Do not file an amended 2013 tax return to account for this adjustment. 1040x 2013 Instead, include the difference of $2,000 (but only to the extent this difference would have increased your 2013 tax) on the “Other income” line of your 2014 Form 1040. 1040x 2013 You cannot file Form 1040A for 2014. 1040x 2013 Amounts that do not reduce qualified education expenses. 1040x 2013   Do not reduce qualified education expenses by amounts paid with funds the student receives as: Payment for services, such as wages, A loan, A gift, An inheritance, or A withdrawal from the student's personal savings. 1040x 2013   Do not reduce the qualified education expenses by any scholarship or fellowship reported as income on the student's tax return in the following situations. 1040x 2013 The use of the money is restricted, by the terms of the scholarship or fellowship, to costs of attendance (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1, Scholarships, Fellowships, Grants, and Tuition Restrictions. 1040x 2013 The use of the money is not restricted. 1040x 2013 Example 1. 1040x 2013 In 2013, Jackie paid $3,000 for tuition and $5,000 for room and board at University X. 1040x 2013 The university did not require her to pay any fees in addition to her tuition in order to enroll in or attend classes. 1040x 2013 To help pay these costs, she was awarded a $2,000 scholarship and a $4,000 student loan. 1040x 2013 The terms of the scholarship state that it can be used to pay any of Jackie's college expenses. 1040x 2013 University X applies the $2,000 scholarship against Jackie's $8,000 total bill, and Jackie pays the $6,000 balance of her bill from University X with a combination of her student loan and her savings. 1040x 2013 Jackie does not report any portion of the scholarship as income on her tax return. 1040x 2013 In figuring the tuition and fees deduction, Jackie must reduce her qualified education expenses by the amount of the scholarship ($2,000) because she excluded the entire scholarship from her income. 1040x 2013 The student loan is not tax-free educational assistance, so she does not need to reduce her qualified expenses by any part of the loan proceeds. 1040x 2013 Jackie is treated as having paid $1,000 in qualified education expenses ($3,000 tuition – $2,000 scholarship) in 2013. 1040x 2013 Example 2. 1040x 2013 The facts are the same as in Example 1, except that Jackie reports her entire scholarship as income on her tax return. 1040x 2013 Because Jackie reported the entire $2,000 scholarship in her income, she does not need to reduce her qualified education expenses. 1040x 2013 Jackie is treated as having paid $3,000 in qualified education expenses. 1040x 2013 Expenses That Do Not Qualify Qualified education expenses do not include amounts paid for: Insurance, Medical expenses (including student health fees), Room and board, Transportation, or Similar personal, living, or family expenses. 1040x 2013 This is true even if the amount must be paid to the institution as a condition of enrollment or attendance. 1040x 2013 Sports, games, hobbies, and noncredit courses. 1040x 2013   Qualified education expenses generally do not include expenses that relate to any course of instruction or other education that involves sports, games or hobbies, or any noncredit course. 1040x 2013 However, if the course of instruction or other education is part of the student's degree program, these expenses can qualify. 1040x 2013 Comprehensive or bundled fees. 1040x 2013   Some eligible educational institutions combine all of their fees for an academic period into one amount. 1040x 2013 If you do not receive, or do not have access to, an allocation showing how much you paid for qualified education expenses and how much you paid for personal expenses, such as those listed above, contact the institution. 1040x 2013 The institution is required to make this allocation and provide you with the amount you paid (or were billed) for qualified education expenses on Form 1098-T. 1040x 2013 See Figuring the Deduction , later, for more information about Form 1098-T. 1040x 2013 Who Is an Eligible Student For purposes of the tuition and fees deduction, an eligible student is a student who is enrolled in one or more courses at an eligible educational institution (as defined under Qualified Education Expenses , earlier). 1040x 2013 Who Can Claim a Dependent's Expenses Generally, in order to claim the tuition and fees deduction for qualified education expenses for a dependent, you must: Have paid the expenses, and Claim an exemption for the student as a dependent. 1040x 2013 For you to be able to deduct qualified education expenses for your dependent, you must claim an exemption for that individual. 1040x 2013 You do this by listing your dependent's name and other required information on Form 1040 (or Form 1040A), line 6c. 1040x 2013 IF your dependent is an eligible student and you. 1040x 2013 . 1040x 2013 . 1040x 2013 AND. 1040x 2013 . 1040x 2013 . 1040x 2013 THEN. 1040x 2013 . 1040x 2013 . 1040x 2013 claim an exemption for your dependent you paid all qualified education expenses for your dependent only you can deduct the qualified education expenses that you paid. 1040x 2013 Your dependent cannot take a deduction. 1040x 2013 claim an exemption for your dependent your dependent paid all qualified education expenses no one is allowed to take a deduction. 1040x 2013 do not claim an exemption for your dependent you paid all qualified education expenses no one is allowed to take a deduction. 1040x 2013 do not claim an exemption for your dependent your dependent paid all qualified education expenses no one is allowed to take a deduction. 1040x 2013 Expenses paid by dependent. 1040x 2013   If your dependent pays qualified education expenses, no one can take a tuition and fees deduction for those expenses. 1040x 2013 Neither you nor your dependent can deduct the expenses. 1040x 2013 For purposes of the tuition and fees deduction, you are not treated as paying any expenses actually paid by a dependent for whom you or anyone other than the dependent can claim an exemption. 1040x 2013 This rule applies even if you do not claim an exemption for your dependent on your tax return. 1040x 2013 Expenses paid by you. 1040x 2013   If you claim an exemption for a dependent who is an eligible student, only you can include any expenses you paid when figuring your tuition and fees deduction. 1040x 2013 Expenses paid under divorce decree. 1040x 2013   Qualified education expenses paid directly to an eligible educational institution for a student under a court-approved divorce decree are treated as paid by the student. 1040x 2013 Only the student would be eligible to take a tuition and fees deduction for that payment, and then only if no one else could claim an exemption for the student. 1040x 2013 Expenses paid by others. 1040x 2013   Someone other than you, your spouse, or your dependent (such as a relative or former spouse) may make a payment directly to an eligible educational institution to pay for an eligible student's qualified education expenses. 1040x 2013 In this case, the student is treated as receiving the payment from the other person and, in turn, paying the institution. 1040x 2013 If you claim, or can claim, an exemption on your tax return for the student, you are not considered to have paid the expenses and you cannot deduct them. 1040x 2013 If the student is not a dependent, only the student can deduct payments made directly to the institution for his or her expenses. 1040x 2013 If the student is your dependent, no one can deduct the payments. 1040x 2013 Example. 1040x 2013 In 2013, Ms. 1040x 2013 Baker makes a payment directly to an eligible educational institution for her grandson Dan's qualified education expenses. 1040x 2013 For purposes of deducting tuition and fees, Dan is treated as receiving the money from his grandmother and, in turn, paying his own qualified education expenses. 1040x 2013 If an exemption cannot be claimed for Dan on anyone else's tax return, only Dan can claim a tuition and fees deduction for his grandmother's payment. 1040x 2013 If someone else can claim an exemption for Dan, no one will be allowed a deduction for Ms. 1040x 2013 Baker's payment. 1040x 2013 Tuition reduction. 1040x 2013   When an eligible educational institution provides a reduction in tuition to an employee of the institution (or spouse or dependent child of an employee), the amount of the reduction may or may not be taxable. 1040x 2013 If it is taxable, the employee is treated as receiving a payment of that amount and, in turn, paying it to the educational institution on behalf of the student. 1040x 2013 For more information on tuition reductions, see Qualified Tuition Reduction , in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. 1040x 2013 Figuring the Deduction The maximum tuition and fees deduction in 2013 is $4,000, $2,000, or $0, depending on the amount of your MAGI. 1040x 2013 See Effect of the Amount of Your Income on the Amount of Your Deduction , later. 1040x 2013 Form 1098-T. 1040x 2013   To help you figure your tuition and fees deduction, the student should receive Form 1098-T (see Appendix A for a completed example of Form 1098-T). 1040x 2013 Generally, an eligible educational institution (such as a college or university) must send Form 1098-T (or acceptable substitute) to each enrolled student by January 31, 2014. 1040x 2013 An institution may choose to report either payments received (box 1), or amounts billed (box 2), for qualified education expenses. 1040x 2013 However, the amount in boxes 1 and 2 of Form 1098-T might be different than what you paid. 1040x 2013 When figuring the deduction, use only the amounts you paid in 2013 for qualified education expenses. 1040x 2013   In addition, Form 1098-T should give other information for that institution, such as adjustments made for prior years, the amount of scholarships or grants, reimbursements or refunds, and whether the student was enrolled at least half-time or was a graduate student. 1040x 2013    The eligible educational institution may ask for a completed Form W-9S or similar statement to obtain the student's name, address, and taxpayer identification number. 1040x 2013 Effect of the Amount of Your Income on the Amount of Your Deduction If your MAGI is not more than $65,000 ($130,000 if you are married filing jointly), your maximum tuition and fees deduction is $4,000. 1040x 2013 If your MAGI is larger than $65,000 ($130,000 if you are married filing jointly), but is not more than $80,000 ($160,000 if you are married filing jointly), your maximum deduction is $2,000. 1040x 2013 No tuition and fees deduction is allowed if your MAGI is larger than $80,000 ($160,000 if you are married filing jointly). 1040x 2013 Modified adjusted gross income (MAGI). 1040x 2013   For most taxpayers, MAGI is adjusted gross income (AGI) as figured on their federal income tax return before subtracting any deduction for tuition and fees. 1040x 2013 However, as discussed below, there may be other modifications. 1040x 2013 MAGI when using Form 1040A. 1040x 2013   If you file Form 1040A, your MAGI is the AGI on line 22 of that form, figured without taking into account any amount on line 19 (tuition and fees deduction). 1040x 2013 MAGI when using Form 1040. 1040x 2013   If you file Form 1040, your MAGI is the AGI on line 38 of that form, figured without taking into account any amount on line 34 (tuition and fees deduction) or line 35 (domestic production activities deduction), and modified by adding back any: Foreign earned income exclusion, Foreign housing exclusion, Foreign housing deduction, Exclusion of income by bona fide residents of American Samoa, and Exclusion of income by bona fide residents of Puerto Rico. 1040x 2013   Table 6-2 shows how the amount of your MAGI can affect your tuition and fees deduction. 1040x 2013   You can use Worksheet 6-1. 1040x 2013 MAGI for the Tuition and Fees Deduction , later, to figure your MAGI. 1040x 2013 Table 6-2. 1040x 2013 Effect of MAGI on Maximum Tuition and Fees Deduction IF your filing status is. 1040x 2013 . 1040x 2013 . 1040x 2013 AND your MAGI is. 1040x 2013 . 1040x 2013 . 1040x 2013 THEN your maximum tuition and fees deduction is. 1040x 2013 . 1040x 2013 . 1040x 2013 single,  head of household, or qualifying widow(er) not more than $65,000 $4,000. 1040x 2013 more than $65,000  but not more than $80,000 $2,000. 1040x 2013 more than $80,000 $0. 1040x 2013 married filing joint return not more than $130,000 $4,000. 1040x 2013 more than $130,000 but not more than $160,000 $2,000. 1040x 2013 more than $160,000 $0. 1040x 2013 Claiming the Deduction You claim a tuition and fees deduction by completing Form 8917 and submitting it with your Form 1040 or Form 1040A. 1040x 2013 Enter the deduction on Form 1040, line 34, or Form 1040A, line 19. 1040x 2013 A filled-in Form 8917 is shown at the end of this chapter. 1040x 2013 Illustrated Example Tim Pfister, a single taxpayer, enrolled full-time at a local college to earn a degree in engineering. 1040x 2013 This is the first year of his postsecondary education. 1040x 2013 During 2013, he paid $3,600 for his qualified 2013 tuition expense. 1040x 2013 Both he and the college meet all of the requirements for the tuition and fees deduction. 1040x 2013 Tim's total income (Form 1040, line 22) and MAGI are $26,000. 1040x 2013 He figures his deduction of $3,600 as shown on Form 8917, later. 1040x 2013 Worksheet 6-1. 1040x 2013 MAGI for the Tuition and Fees Deduction Use this worksheet if you are filing Form 2555, 2555-EZ, or 4563, or you are excluding income from sources within Puerto Rico. 1040x 2013 Before using this worksheet, you must complete Form 1040, lines 7 through 33, and figure any amount to be entered on the dotted line next to line 36. 1040x 2013 1. 1040x 2013 Enter the amount from Form 1040, line 22   1. 1040x 2013         2. 1040x 2013 Enter the total from Form 1040, lines 23 through 33   2. 1040x 2013               3. 1040x 2013 Enter the total of any amounts entered on the dotted line next to Form 1040, line 36   3. 1040x 2013               4. 1040x 2013 Add lines 2 and 3   4. 1040x 2013         5. 1040x 2013 Subtract line 4 from line 1   5. 1040x 2013         6. 1040x 2013 Enter your foreign earned income exclusion and/or housing  exclusion (Form 2555, line 45, or Form 2555-EZ, line 18)   6. 1040x 2013         7. 1040x 2013 Enter your foreign housing deduction (Form 2555, line 50)   7. 1040x 2013         8. 1040x 2013 Enter the amount of income from Puerto Rico you are excluding   8. 1040x 2013         9. 1040x 2013 Enter the amount of income from American Samoa you are  excluding (Form 4563, line 15)   9. 1040x 2013         10. 1040x 2013 Add lines 5 through 9. 1040x 2013 This is your modified adjusted gross income   10. 1040x 2013     Note. 1040x 2013 If the amount on line 10 is more than $80,000 ($160,000 if married filing jointly),  you cannot take the deduction for tuition and fees. 1040x 2013       This image is too large to be displayed in the current screen. 1040x 2013 Please click the link to view the image. 1040x 2013 Form 8917 for Tim Pfister Prev  Up  Next   Home   More Online Publications
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IRS Offers New Streamlined Option to Certain 501(c)(4) Groups Caught in Application Backlog

FS-2013-8, June 2013

Following a review of internal procedures to reduce the backlog of tax-exempt applications, the IRS is offering certain organizations that have applied for 501(c)(4) status a faster, optional method to gain tax-exempt status.

The IRS will start mailing about 80 letters this week offering the expedited option to groups that have had their applications pending for more than 120 days and involve possible political campaign intervention or issue advocacy. This effort is part of an internal review of IRS operations, processes and practices at the IRS announced today.

“The IRS is committed to improving our tax-exempt review process,” said IRS Principal Deputy Commissioner Danny Werfel. “This new streamlined option gives certain groups that have waited far too long a quick and clear path to get their status resolved.”

This “safe-harbor” option will provide certain groups an approved determination letter granting them 501(c)(4) status within two weeks if they certify they devote 60 percent or more of both their spending and time on activities that promote social welfare as defined by Section 501(c)(4). At the same time, they must certify that political campaign intervention involves less than 40 percent of both their spending and time. These thresholds apply for past, current and future years of operation. Solely for the purpose of determining eligibility for the expedited procedure, an organization must count, among other things, any public communication identifying a candidate that occurred within 60 days prior to a general election or 30 days prior to a primary as political campaign intervention.

 “The IRS will treat these groups fairly and review applications promptly, a step that will immediately reduce the backlog of these cases,” Werfel said. “At the same time, the IRS will work to ensure 501(c)(4) groups follow the law set by Congress. As part of our efforts, the IRS will continue to look for ways to improve its processes going forward.”

The IRS also emphasized that any eligible organizations that do not choose the expedited option will be treated fairly and expeditiously through the regular review process.

Full details of the expedited process and specific instructions for the groups qualifying for the option can be found in IRS Letter 5228.

Related Item: New Review Process and Expedited Self-Certification Option

 

Page Last Reviewed or Updated: 19-Dec-2013

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