Chod is not only my classmate, but also a friend of mine had come to me for some advice on a tax related issue. He is worried about several issues on his tax return next year. One of his concern is how his tax return would be affected if he usually gets financial aid but turn out next year he won’t be. What would be better for him? He asks me if him and his wife should get a loan or pay the school tuition from their own pocket. Well I explained to him that if he gets a loan is not a good idea because borrow a loan for school has to pay interest rates and you are paying actually more than you should. He is married and is age of 23. This year he has already filed his tax return, he wants to know if he didn’t file jointly but filing a separate
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I explained to him that it would be illegal to do so because you can’t claim for both semesters if you're not going to attend in Fall and that person is giving you false information. He seems like he didn’t listen and still want to do it. I told him education credits have two types available to students who paid tuition, and if they are qualify, claiming the credits would be simple. The availability of American Opportunity Tax credit (AOTC) and the Lifetime Learning credit . These credits are only available to middle to lower income taxpayers, it provides financial assistance to students/taxpayers those attending college. For AOTC, the program available to cover tuition expenses in the first four years of school and allows students to get up to $ 2,500 annually to help pay for college (100 percent of the first $2,000 of tuition expenses plus 25 percent of the next $2,000 of tuition expenses) . And for the lifetime learning credit, permits a credit of 20% of qualifying expenses and up to $10,000 a year (2016). From the given information he has given, they are qualified for AOTC only. They are ineligible for lifetime learning credit because they are not enrolling in a job-related
I explained to him that it would be illegal to do so because you can’t claim for both semesters if you're not going to attend in Fall and that person is giving you false information. He seems like he didn’t listen and still want to do it. I told him education credits have two types available to students who paid tuition, and if they are qualify, claiming the credits would be simple. The availability of American Opportunity Tax credit (AOTC) and the Lifetime Learning credit . These credits are only available to middle to lower income taxpayers, it provides financial assistance to students/taxpayers those attending college. For AOTC, the program available to cover tuition expenses in the first four years of school and allows students to get up to $ 2,500 annually to help pay for college (100 percent of the first $2,000 of tuition expenses plus 25 percent of the next $2,000 of tuition expenses) . And for the lifetime learning credit, permits a credit of 20% of qualifying expenses and up to $10,000 a year (2016). From the given information he has given, they are qualified for AOTC only. They are ineligible for lifetime learning credit because they are not enrolling in a job-related