Education Deduction and Tuition reimbursement


Y

Yankee1423

I had a little over $2000 in tuition costs at a Grad School
this year. 70% of those costs were paid for by a tuition
reimbursement program. This was not included on my wages.
Can I claim the full amount or only the 30% that I was
responsible for? The university sent me the form which
shows only half that amount b/c I was not considered half
time for one semester.
 
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B

Bill

I had a little over $2000 in tuition costs at a
Grad School this year. 70% of those costs
were paid for by a tuition reimbursement
program. This was not included on my wages.
Can I claim the full amount or only the 30%
that I was responsible for? The university sent
me the form which shows only half that
amount b/c I was not considered half time for
one semester.
You may use only the 30% you actually paid, and you have the
choice of two tax-reduction alternatives: The Lifetime
Learning Credit, using Form 8863, which is a direct tax
credit for a percentage of your tuition expense, or an
Adjustment to Income (found at the bottom of Page 1, Form
1040 -- line 27).

Figure the tax benefit of the two alternatives, and choose
whichever saves you the most. (Usually, it's the tax
credit.)

Bill
 

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