1098 T

[TAX]

Client, Parent has AGI = 243000. So he can not take education credit for child

Can child take? Parent is claiming child dependent.

Child is under 24 and student

Thanks!

[Matt Sova]

TTB pg 12-3

The child can claim the credit only if the parents elect not to claim the child. The child cannot claim himself so no one gets the exemption, but the child can then take the credit.

Also, the child cannot get the refundable portion of the AOC.

[Super Mom]

Check Qualifications

If The Child Meets The Qualification To Claim Himself, He Can Claim Himself If The Parents Haven't Yet And Then Get Some Edu. Credit.

[TAX]

Revised

The child can claim the credit only if the parents elect not to claim the child. The child cannot claim himself so no one gets the exemption, but the child can then take the credit.

Also, the child cannot get the refundable portion of the AOC.

Thank you!

I think I wrote it wrong.

Parent can claim child as a dependent but does not want to as parent's AGI is high and no benefit. Also high AGI prevents them from getting education credit.

Can Child file a seperate return -has no income but capital loss ($4000). But child can get $1000 refundable credit.

[S T]

Ed Credits

This is so confusing - and OP did not post which Ed Credit, but I believe referring to the AOC?
From TTB 12-3under AOC

Choosing Not to Claim an Exemption for a Dependent Student
If a taxpayer chooses not to claim the exemption for his or her dependent, the student can then:
• Claim an education credit (American Opportunity, Lifetime Learning, or Hope credit).
• Deduct qualifying student loan interest.
The student is not entitled to claim his or her own exemption.
The refundable portion of the American Opportunity credit is not available to the student.

From Pub 970

Who Can Claim a Dependent’s Expenses
If there are qualified education expenses for your dependent during a tax year, either you or your dependent, but not both of you, can claim an American opportunity credit
for your dependent’s expenses for that year. For you to claim an American opportunity credit for your dependent’s expenses, you must also claim an exemption
for your dependent. You do this by listing your dependent’s name and other required information on Form 1040 (or Form 1040A), line 6c.
IF you...claim an exemption on your tax return for a dependent who is an eligible student, THEN only... you can claim the American Opportunity credit based on that dependent's expenses. The dependent cannot claim the credit.

If you, do "not" claim an exemption on your tax return for a dependent who is an eligible student (even if entitled to the exemption) THEN only the dependent can claim the American opportunity credit. You cannot claim the credit based on this dependent's expenses.

Refundable Part of Credit
Forty percent of AOC is refundable for most taxpayers. However, if you were under the age of 24 at the end of 2009 and the conditions listed below apply, you cannot claim any part of the American opportunity credit as a refundable credit on your tax return. Instead, your allowed credit (figured on Form 8863, Part V) will be used to reduce your tax as a nonrefundable credit only.
You do not qualify for a refund if items 1, 2, and 3 below apply to you.
1. You were:
a. Under age 18 at the end of 2009, or
b. Age 18 at the end of 2009 and your earned income (defined below) was less than one-half of your support (defined below), or
c. A full-time student over age 18 and under age 24 at the end of 2009 and your earned income (defined below) was less than one-half of your supiport (defined below).
2. At least one of your parents was alive at the end of 2009.
3. You are not filing a joint return for 2009.

So for the child - no refundable credit

Sandy

[TAX]

Education Credit

Thank you all. I got it