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Tuition and Fees Deduction

Another popular tax deduction is the tuition and fees deduction. Below is the guideline and tips on the tuition and fee tax deduction allowable by the IRS.

What is the maximum tuition and fees deduction?

The maximum tuition and fees deduction for 2007 is up to $4,000 per tax return for qualified education expenses for:

  • taxpayer
  • spouse (if married and filing jointly)
  • dependent for whom an exemption can be claimed

The tuition and fees deduction may be limited if the modified adjusted gross income (MAGI) exceeds certain limits.

What are qualified edcuation expenses?

Qualified education expenses are:

  • tuition and certain related expenses required to enroll at or attend an eligible education institution.

Student activity fees and expenses for course related books, supplies, and equipment are only included in qualified education expenses if the fees and expenses must be paid to institution as a condition of enrollment or attendance.

What are not included in the qualified education expenses?

Qualified education expenses do not include:

  • room and board
  • transportation
  • similar personal living expenses
  • family expenses
  • expenses paid with tax free scholarship, grant or employer provided educational assistance
Which tax form to use to figure out the tuition and fees tax deductions?

IRS tax form 8917 is used to calculate the tuition and fees tax deductions.

When can I not claim the tuition and fees deductions?

Tuition and fees deductions are not allowed by the IRS if:

  • the taxpayer is married but filing separately
  • the student is claiming the Hope or lifetime learning education tax credit for qualified tuition and related expenses in the same year
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