File your Taxes for Free!
  • Get your maximum refund*
  • 100% accurate calculations guaranteed*

TurboTax Federal Free Edition - File Taxes Online

Don't let filing your taxes get you down! We'll help make it as easy as possible. With e-file and direct deposit, there's no faster way to get your refund!

Approved TurboTax Affiliate Site. TurboTax and TurboTax Online, among others, are registered trademarks and/or service marks of Intuit Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.


© 2012 - 2018 All rights reserved.

This is an Approved TurboTax Affiliate site. TurboTax and TurboTax Online, among other are registered trademarks and/or service marks of Intuit, Inc. in the United States and other countries. Other parties' trademarks or service marks are the property of the respective owners.
When discussing "Free e-file", note that state e-file is an additional fee. E-file fees do not apply to New York state returns. Prices are subject to change without notice. E-file and get your refund faster
*If you pay an IRS or state penalty or interest because of a TurboTax calculations error, we'll pay you the penalty and interest.
*Maximum Refund Guarantee - or Your Money Back: If you get a larger refund or smaller tax due from another tax preparation method, we'll refund the applicable TurboTax federal and/or state purchase price paid. TurboTax Federal Free Edition customers are entitled to payment of $14.99 and a refund of your state purchase price paid. Claims must be submitted within sixty (60) days of your TurboTax filing date and no later than 6/15/14. E-file, Audit Defense, Professional Review, Refund Transfer and technical support fees are excluded. This guarantee cannot be combined with the TurboTax Satisfaction (Easy) Guarantee. *We're so confident your return will be done right, we guarantee it. Accurate calculations guaranteed. If you pay an IRS or state penalty or interest because of a TurboTax calculations error, we'll pay you the penalty and interest.
https://turbotax.intuit.com/corp/guarantees.jsp

Tax Forms 2012 Federal

Instructions For Filing 1040ezTax Forms 1040 EzFree 1040ez H&r BlockFill Out 1040x Online1040nr Ez SoftwareHow Do I Refile My Taxes1040 Amended Tax FormIrs Free State Tax FilingIrs Free State File Tax Return1040ez Income Tax FormTax Planning Us Back TaxesNonresidents State Tax FormsH&r Block 2011 Taxes10ezH And R Block E FileHow To Do State Taxes For FreeFree Online Tax FilingFree Federal & State E-fileCan I Still File My 2011 Tax ReturnHow Do I Do An Amended Tax ReturnHow To File Tax ReturnFree File State TaxForm 1040 EsFile 2009 Tax Return TurbotaxWww Freefile Irs Gov1040 Ez For 2012H And R Block Tax EstimatorIrs Form 1040 X2013 1040ez Tax FormAmend 2013 Tax ReturnTax Compliance SoftwareSoftware To File 1040nrAmending A Tax Return1040ez Instructions 2012Irse File2012 Tax Preparation Software1040ez Fillable Form2010 Free Tax Software DownloadEz Form 10402011 Income Tax Form

Tax Forms 2012 Federal

Tax forms 2012 federal 6. Tax forms 2012 federal   How To Figure Cost of Goods Sold Table of Contents Introduction Figuring Cost of Goods Sold on Schedule C, Lines 35 Through 42Line 35 Inventory at Beginning of Year Line 36 Purchases Less Cost of Items Withdrawn for Personal Use Line 37 Cost of Labor Line 38 Materials and Supplies Line 39 Other Costs Line 40 Add Lines 35 through 39 Line 41 Inventory at End of Year Line 42 Cost of Goods Sold Introduction If you make or buy goods to sell, you can deduct the cost of goods sold from your gross receipts on Schedule C. Tax forms 2012 federal However, to determine these costs, you must value your inventory at the beginning and end of each tax year. Tax forms 2012 federal This chapter applies to you if you are a manufacturer, wholesaler, or retailer or if you are engaged in any business that makes, buys, or sells goods to produce income. Tax forms 2012 federal This chapter does not apply to a personal service business, such as the business of a doctor, lawyer, carpenter, or painter. Tax forms 2012 federal However, if you work in a personal service business and also sell or charge for the materials and supplies normally used in your business, this chapter applies to you. Tax forms 2012 federal If you must account for an inventory in your business, you must generally use an accrual method of accounting for your purchases and sales. Tax forms 2012 federal For more information, see chapter 2. Tax forms 2012 federal Figuring Cost of Goods Sold on Schedule C, Lines 35 Through 42 Figure your cost of goods sold by filling out lines 35 through 42 of Schedule C. Tax forms 2012 federal These lines are reproduced below and are explained in the discussion that follows. Tax forms 2012 federal 35 Inventory at beginning of year. Tax forms 2012 federal If different from last year's closing inventory, attach explanation   36 Purchases less cost of items withdrawn for personal use   37 Cost of labor. Tax forms 2012 federal Do not include any amounts paid to yourself   38 Materials and supplies   39 Other costs   40 Add lines 35 through 39   41 Inventory at end of year   42 Cost of goods sold. Tax forms 2012 federal Subtract line 41 from line 40. Tax forms 2012 federal  Enter the result here and on line 4   Line 35 Inventory at Beginning of Year If you are a merchant, beginning inventory is the cost of merchandise on hand at the beginning of the year that you will sell to customers. Tax forms 2012 federal If you are a manufacturer or producer, it includes the total cost of raw materials, work in process, finished goods, and materials and supplies used in manufacturing the goods (see Inventories in chapter 2). Tax forms 2012 federal Opening inventory usually will be identical to the closing inventory of the year before. Tax forms 2012 federal You must explain any difference in a schedule attached to your return. Tax forms 2012 federal Donation of inventory. Tax forms 2012 federal   If you contribute inventory (property that you sell in the course of your business), the amount you can claim as a contribution deduction is the smaller of its fair market value on the day you contributed it or its basis. Tax forms 2012 federal The basis of donated inventory is any cost incurred for the inventory in an earlier year that you would otherwise include in your opening inventory for the year of the contribution. Tax forms 2012 federal You must remove the amount of your contribution deduction from your opening inventory. Tax forms 2012 federal It is not part of the cost of goods sold. Tax forms 2012 federal   If the cost of donated inventory is not included in your opening inventory, the inventory's basis is zero and you cannot claim a charitable contribution deduction. Tax forms 2012 federal Treat the inventory's cost as you would ordinarily treat it under your method of accounting. Tax forms 2012 federal For example, include the purchase price of inventory bought and donated in the same year in the cost of goods sold for that year. Tax forms 2012 federal   A special rule may apply to certain donations of food inventory. Tax forms 2012 federal See Publication 526, Charitable Contributions. Tax forms 2012 federal Example 1. Tax forms 2012 federal You are a calendar year taxpayer who uses an accrual method of accounting. Tax forms 2012 federal In 2013, you contributed property from inventory to a church. Tax forms 2012 federal It had a fair market value of $600. Tax forms 2012 federal The closing inventory at the end of 2012 properly included $400 of costs due to the acquisition of the property, and in 2012, you properly deducted $50 of administrative and other expenses attributable to the property as business expenses. Tax forms 2012 federal The charitable contribution allowed for 2013 is $400 ($600 − $200). Tax forms 2012 federal The $200 is the amount that would be ordinary income if you had sold the contributed inventory at fair market value on the date of the gift. Tax forms 2012 federal The cost of goods sold you use in determining gross income for 2013 must not include the $400. Tax forms 2012 federal You remove that amount from opening inventory for 2013. Tax forms 2012 federal Example 2. Tax forms 2012 federal If, in Example 1, you acquired the contributed property in 2013 at a cost of $400, you would include the $400 cost of the property in figuring the cost of goods sold for 2013 and deduct the $50 of administrative and other expenses attributable to the property for that year. Tax forms 2012 federal You would not be allowed any charitable contribution deduction for the contributed property. Tax forms 2012 federal Line 36 Purchases Less Cost of Items Withdrawn for Personal Use If you are a merchant, use the cost of all merchandise you bought for sale. Tax forms 2012 federal If you are a manufacturer or producer, this includes the cost of all raw materials or parts purchased for manufacture into a finished product. Tax forms 2012 federal Trade discounts. Tax forms 2012 federal   The differences between the stated prices of articles and the actual prices you pay for them are called trade discounts. Tax forms 2012 federal You must use the prices you pay (not the stated prices) in figuring your cost of purchases. Tax forms 2012 federal Do not show the discount amount separately as an item in gross income. Tax forms 2012 federal   An automobile dealer must record the cost of a car in inventory reduced by any manufacturer's rebate that represents a trade discount. Tax forms 2012 federal Cash discounts. Tax forms 2012 federal   Cash discounts are amounts your suppliers let you deduct from your purchase invoices for prompt payments. Tax forms 2012 federal There are two methods of accounting for cash discounts. Tax forms 2012 federal You can either credit them to a separate discount account or deduct them from total purchases for the year. Tax forms 2012 federal Whichever method you use, you must be consistent. Tax forms 2012 federal If you want to change your method of figuring inventory cost, you must file Form 3115, Application for Change in Accounting Method. Tax forms 2012 federal For more information, see Change in Accounting Method in chapter 2. Tax forms 2012 federal   If you credit cash discounts to a separate account, you must include this credit balance in your business income at the end of the tax year. Tax forms 2012 federal If you use this method, do not reduce your cost of goods sold by the cash discounts. Tax forms 2012 federal Purchase returns and allowances. Tax forms 2012 federal   You must deduct all returns and allowances from your total purchases during the year. Tax forms 2012 federal Merchandise withdrawn from sale. Tax forms 2012 federal   If you withdraw merchandise for your personal or family use, you must exclude this cost from the total amount of merchandise you bought for sale. Tax forms 2012 federal Do this by crediting the purchases or sales account with the cost of merchandise you withdraw for personal use. Tax forms 2012 federal You must also charge the amount to your drawing account. Tax forms 2012 federal   A drawing account is a separate account you should keep to record the business income you withdraw to pay for personal and family expenses. Tax forms 2012 federal As stated above, you also use it to record withdrawals of merchandise for personal or family use. Tax forms 2012 federal This account is also known as a “withdrawals account” or “personal account. Tax forms 2012 federal ” Line 37 Cost of Labor Labor costs are usually an element of cost of goods sold only in a manufacturing or mining business. Tax forms 2012 federal Small merchandisers (wholesalers, retailers, etc. Tax forms 2012 federal ) usually do not have labor costs that can properly be charged to cost of goods sold. Tax forms 2012 federal In a manufacturing business, labor costs properly allocable to the cost of goods sold include both the direct and indirect labor used in fabricating the raw material into a finished, saleable product. Tax forms 2012 federal Direct labor. Tax forms 2012 federal   Direct labor costs are the wages you pay to those employees who spend all their time working directly on the product being manufactured. Tax forms 2012 federal They also include a part of the wages you pay to employees who work directly on the product part time if you can determine that part of their wages. Tax forms 2012 federal Indirect labor. Tax forms 2012 federal   Indirect labor costs are the wages you pay to employees who perform a general factory function that does not have any immediate or direct connection with making the saleable product, but that is a necessary part of the manufacturing process. Tax forms 2012 federal Other labor. Tax forms 2012 federal   Other labor costs not properly chargeable to the cost of goods sold can be deducted as selling or administrative expenses. Tax forms 2012 federal Generally, the only kinds of labor costs properly chargeable to your cost of goods sold are the direct or indirect labor costs and certain other costs treated as overhead expenses properly charged to the manufacturing process, as discussed later under Line 39 Other Costs. Tax forms 2012 federal Line 38 Materials and Supplies Materials and supplies, such as hardware and chemicals, used in manufacturing goods are charged to cost of goods sold. Tax forms 2012 federal Those that are not used in the manufacturing process are treated as deferred charges. Tax forms 2012 federal You deduct them as a business expense when you use them. Tax forms 2012 federal Business expenses are discussed in chapter 8. Tax forms 2012 federal Line 39 Other Costs Examples of other costs incurred in a manufacturing or mining process that you charge to your cost of goods sold are as follows. Tax forms 2012 federal Containers. Tax forms 2012 federal   Containers and packages that are an integral part of the product manufactured are a part of your cost of goods sold. Tax forms 2012 federal If they are not an integral part of the manufactured product, their costs are shipping or selling expenses. Tax forms 2012 federal Freight-in. Tax forms 2012 federal   Freight-in, express-in, and cartage-in on raw materials, supplies you use in production, and merchandise you purchase for sale are all part of cost of goods sold. Tax forms 2012 federal Overhead expenses. Tax forms 2012 federal   Overhead expenses include expenses such as rent, heat, light, power, insurance, depreciation, taxes, maintenance, labor, and supervision. Tax forms 2012 federal The overhead expenses you have as direct and necessary expenses of the manufacturing operation are included in your cost of goods sold. Tax forms 2012 federal Line 40 Add Lines 35 through 39 The total of lines 35 through 39 equals the cost of the goods available for sale during the year. Tax forms 2012 federal Line 41 Inventory at End of Year Subtract the value of your closing inventory (including, as appropriate, the allocable parts of the cost of raw materials and supplies, direct labor, and overhead expenses) from line 40. Tax forms 2012 federal Inventory at the end of the year is also known as closing or ending inventory. Tax forms 2012 federal Your ending inventory will usually become the beginning inventory of your next tax year. Tax forms 2012 federal Line 42 Cost of Goods Sold When you subtract your closing inventory (inventory at the end of the year) from the cost of goods available for sale, the remainder is your cost of goods sold during the tax year. Tax forms 2012 federal Prev  Up  Next   Home   More Online Publications
Print - Click this link to Print this page

Commissioner John Koskinen

John Koskinen is the 48th IRS Commissioner. As Commissioner, he presides over the nation’s tax system, which collects approximately $2.4 trillion in tax revenue each year. This revenue funds most government operations and public services. Mr. Koskinen manages an agency of about 90,000 employees and a budget of approximately $11 billion.

In his role leading the IRS, Mr. Koskinen is working to ensure that the agency maintains an appropriate balance between taxpayer service and tax enforcement and administers the tax code with fairness and integrity.

Prior to his appointment, Mr. Koskinen served as the non-executive chairman of Freddie Mac from 2008 to 2012 and its acting chief executive officer in 2009. Previously, Mr. Koskinen served as President of the U.S. Soccer Foundation, Deputy Mayor and City Administrator of Washington D.C., Assistant to the President and Chair of the President's Council on Year 2000 Conversion and Deputy Director for Management at the Office of Management and Budget. Mr. Koskinen also spent 21 years in the private sector in various leadership positions with the Palmieri Company, including President and Chief Executive Officer, helping to turn around large, troubled organizations. He began his career clerking for Chief Judge David L. Bazelon of the DC Circuit Court of Appeals in 1965, practiced law with the firm of Gibson, Dunn and Crutcher and served as Assistant to the Deputy Executive Director of the National Advisory Commission on Civil Disorders, also known as the Kerner Commission. Mr. Koskinen also served as Legislative Assistant to New York Mayor John Lindsay and Administrative Assistant to Sen. Abraham Ribicoff of Connecticut.

Mr. Koskinen holds a Law Degree from Yale University School of Law and a Bachelor’s Degree from Duke University. He also studied International Law for one year in Cambridge, England. He and his wife Patricia have two grown children and live in Washington, DC.

 

Page Last Reviewed or Updated: 14-Feb-2014

The Tax Forms 2012 Federal

Tax forms 2012 federal 6. Tax forms 2012 federal   Tuition and Fees Deduction Table of Contents IntroductionWhat is the tax benefit of the tuition and fees deduction. Tax forms 2012 federal 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). Tax forms 2012 federal 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. Tax forms 2012 federal The qualified expenses must be for higher education, as explained later under Qualified Education Expenses . Tax forms 2012 federal What is the tax benefit of the tuition and fees deduction. Tax forms 2012 federal   The tuition and fees deduction can reduce the amount of your income subject to tax by up to $4,000. Tax forms 2012 federal   This deduction is taken as an adjustment to income. Tax forms 2012 federal This means you can claim this deduction even if you do not itemize deductions on Schedule A (Form 1040). Tax forms 2012 federal This deduction may be beneficial to you if you do not qualify for the American opportunity or lifetime learning credits. Tax forms 2012 federal You can choose the education benefit that will give you the lowest tax. Tax forms 2012 federal You may want to compare the tuition and fees deduction to the education credits. Tax forms 2012 federal See chapter 2, American Opportunity Credit and chapter 3, Lifetime Learning Credit for more information on the education credits. Tax forms 2012 federal Table 6-1. Tax forms 2012 federal Tuition and Fees Deduction at a Glance summarizes the features of the tuition and fees deduction. Tax forms 2012 federal Can You Claim the Deduction The following rules will help you determine if you can claim the tuition and fees deduction. Tax forms 2012 federal Who Can Claim the Deduction Generally, you can claim the tuition and fees deduction if all three of the following requirements are met. Tax forms 2012 federal You pay qualified education expenses of higher education. Tax forms 2012 federal You pay the education expenses for an eligible student. Tax forms 2012 federal The eligible student is yourself, your spouse, or your dependent for whom you claim an exemption on your tax return. Tax forms 2012 federal The term “qualified education expenses” is defined later under Qualified Education Expenses . Tax forms 2012 federal “Eligible student” is defined later under Who Is an Eligible Student . Tax forms 2012 federal For more information on claiming the deduction for a dependent, see Who Can Claim a Dependent's Expenses , later. Tax forms 2012 federal Table 6-1. Tax forms 2012 federal Tuition and Fees Deduction at a Glance Do not rely on this table alone. Tax forms 2012 federal Refer to the text for complete details. Tax forms 2012 federal Question Answer What is the maximum benefit? You can reduce your income subject to tax by up to $4,000. Tax forms 2012 federal 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). Tax forms 2012 federal Where is the deduction taken? As an adjustment to income on  Form 1040 or Form 1040A. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal Who Cannot Claim the Deduction You cannot claim the tuition and fees deduction if any of the following apply. Tax forms 2012 federal Your filing status is married filing separately. Tax forms 2012 federal Another person can claim an exemption for you as a dependent on his or her tax return. Tax forms 2012 federal You cannot take the deduction even if the other person does not actually claim that exemption. Tax forms 2012 federal Your modified adjusted gross income (MAGI) is more than $80,000 ($160,000 if filing a joint return). Tax forms 2012 federal 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. Tax forms 2012 federal More information on nonresident aliens can be found in Publication 519. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal Academic period. Tax forms 2012 federal   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. Tax forms 2012 federal 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. Tax forms 2012 federal Paid with borrowed funds. Tax forms 2012 federal   You can claim a tuition and fees deduction for qualified education expenses paid with the proceeds of a loan. Tax forms 2012 federal 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. Tax forms 2012 federal Treat loan disbursements sent directly to the educational institution as paid on the date the institution credits the student's account. Tax forms 2012 federal Student withdraws from class(es). Tax forms 2012 federal   You can claim a tuition and fees deduction for qualified education expenses not refunded when a student withdraws. Tax forms 2012 federal 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. Tax forms 2012 federal Eligible educational institution. Tax forms 2012 federal   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. Tax forms 2012 federal S. Tax forms 2012 federal Department of Education. Tax forms 2012 federal It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. Tax forms 2012 federal The educational institution should be able to tell you if it is an eligible educational institution. Tax forms 2012 federal   Certain educational institutions located outside the United States also participate in the U. Tax forms 2012 federal S. Tax forms 2012 federal Department of Education's Federal Student Aid (FSA) programs. Tax forms 2012 federal Related expenses. Tax forms 2012 federal   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. Tax forms 2012 federal Prepaid expenses. Tax forms 2012 federal   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. Tax forms 2012 federal See Academic period , earlier. Tax forms 2012 federal 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). Tax forms 2012 federal 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). Tax forms 2012 federal In the following examples, assume that each student is an eligible student and each college or university an eligible educational institution. Tax forms 2012 federal Example 1. Tax forms 2012 federal Jackson is a sophomore in University V's degree program in dentistry. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal Example 2. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal Charles bought his books from a friend, so what he paid for them is not a qualified education expense. Tax forms 2012 federal Donna bought hers at College W's bookstore. Tax forms 2012 federal 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. Tax forms 2012 federal Example 3. Tax forms 2012 federal When Marci enrolled at College X for her freshman year, she had to pay a separate student activity fee in addition to her tuition. Tax forms 2012 federal 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. Tax forms 2012 federal No portion of the fee covers personal expenses. Tax forms 2012 federal Although labeled as a student activity fee, the fee is required for Marci's enrollment and attendance at College X. Tax forms 2012 federal Therefore, it is a qualified expense. Tax forms 2012 federal No Double Benefit Allowed You cannot do any of the following. Tax forms 2012 federal Deduct qualified education expenses you deduct under any other provision of the law, for example, as a business expense. Tax forms 2012 federal 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. Tax forms 2012 federal 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). Tax forms 2012 federal 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. Tax forms 2012 federal See Coordination With Tuition and Fees Deduction in chapter 8, Qualified Tuition Program, later. Tax forms 2012 federal Deduct qualified education expenses that have been paid with tax-free interest on U. Tax forms 2012 federal S. Tax forms 2012 federal savings bonds (Form 8815). Tax forms 2012 federal See Figuring the Tax-Free Amount in chapter 10, Education Savings Bond Program, later. Tax forms 2012 federal Deduct qualified education expenses that have been paid with tax-free educational assistance, such as a scholarship, grant, or assistance provided by an employer. Tax forms 2012 federal See the following section on Adjustments to Qualified Education Expenses. Tax forms 2012 federal 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. Tax forms 2012 federal The result is the amount of adjusted qualified education expenses for each student. Tax forms 2012 federal You must also reduce qualified education expenses by the other amounts referred to in No Double Benefit Allowed , earlier. Tax forms 2012 federal Tax-free educational assistance. Tax forms 2012 federal   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. Tax forms 2012 federal See Academic period , earlier. Tax forms 2012 federal   Some tax-free educational assistance received after 2013 may be treated as a refund of qualified education expenses paid in 2013. Tax forms 2012 federal 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). Tax forms 2012 federal   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. Tax forms 2012 federal 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. Tax forms 2012 federal   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. Tax forms 2012 federal Generally, any scholarship or fellowship is treated as tax free. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal For details, see Adjustments to Qualified Education Expenses in chapters 2 and 3. Tax forms 2012 federal Refunds. Tax forms 2012 federal   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. Tax forms 2012 federal Some tax-free educational assistance received after 2013 may be treated as a refund. Tax forms 2012 federal See Tax-free educational assistance , earlier. Tax forms 2012 federal Refunds received in 2013. Tax forms 2012 federal   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. Tax forms 2012 federal Refunds received after 2013 but before your income tax return is filed. Tax forms 2012 federal   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. Tax forms 2012 federal Refunds received after 2013 and after your income tax return is filed. Tax forms 2012 federal   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. Tax forms 2012 federal See Credit recapture , later. Tax forms 2012 federal Coordination with Coverdell education savings accounts and qualified tuition programs. Tax forms 2012 federal   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). Tax forms 2012 federal 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. Tax forms 2012 federal Credit recapture. Tax forms 2012 federal    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. Tax forms 2012 federal 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. Tax forms 2012 federal 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). Tax forms 2012 federal Include that amount as an additional tax for the year the refund or tax-free assistance was received. Tax forms 2012 federal Example. Tax forms 2012 federal   You paid $3,500 of qualified education expenses in December 2013, and your child began college in January 2014. Tax forms 2012 federal You claimed $3,500 as the tuition and fees deduction on your 2013 income tax return. Tax forms 2012 federal The reduction reduced your taxable income by $3,500. Tax forms 2012 federal Also, you claimed no tax credits in 2013. Tax forms 2012 federal Your child withdrew from two classes and you received a refund of $2,000 in 2014 after you filed your 2013 tax return. Tax forms 2012 federal Refigure your 2013 tuition and fees deduction using $1,500 of qualified education expense instead of the $3,500. Tax forms 2012 federal The refigured tuition and fees deduction is $1,500. Tax forms 2012 federal Do not file an amended 2013 tax return to account for this adjustment. Tax forms 2012 federal 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. Tax forms 2012 federal You cannot file Form 1040A for 2014. Tax forms 2012 federal Amounts that do not reduce qualified education expenses. Tax forms 2012 federal   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. Tax forms 2012 federal   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. Tax forms 2012 federal 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. Tax forms 2012 federal The use of the money is not restricted. Tax forms 2012 federal Example 1. Tax forms 2012 federal In 2013, Jackie paid $3,000 for tuition and $5,000 for room and board at University X. Tax forms 2012 federal The university did not require her to pay any fees in addition to her tuition in order to enroll in or attend classes. Tax forms 2012 federal To help pay these costs, she was awarded a $2,000 scholarship and a $4,000 student loan. Tax forms 2012 federal The terms of the scholarship state that it can be used to pay any of Jackie's college expenses. Tax forms 2012 federal 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. Tax forms 2012 federal Jackie does not report any portion of the scholarship as income on her tax return. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal Jackie is treated as having paid $1,000 in qualified education expenses ($3,000 tuition – $2,000 scholarship) in 2013. Tax forms 2012 federal Example 2. Tax forms 2012 federal The facts are the same as in Example 1, except that Jackie reports her entire scholarship as income on her tax return. Tax forms 2012 federal Because Jackie reported the entire $2,000 scholarship in her income, she does not need to reduce her qualified education expenses. Tax forms 2012 federal Jackie is treated as having paid $3,000 in qualified education expenses. Tax forms 2012 federal 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. Tax forms 2012 federal This is true even if the amount must be paid to the institution as a condition of enrollment or attendance. Tax forms 2012 federal Sports, games, hobbies, and noncredit courses. Tax forms 2012 federal   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. Tax forms 2012 federal However, if the course of instruction or other education is part of the student's degree program, these expenses can qualify. Tax forms 2012 federal Comprehensive or bundled fees. Tax forms 2012 federal   Some eligible educational institutions combine all of their fees for an academic period into one amount. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal See Figuring the Deduction , later, for more information about Form 1098-T. Tax forms 2012 federal 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). Tax forms 2012 federal 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. Tax forms 2012 federal For you to be able to deduct qualified education expenses for your dependent, you must claim an exemption for that individual. Tax forms 2012 federal You do this by listing your dependent's name and other required information on Form 1040 (or Form 1040A), line 6c. Tax forms 2012 federal IF your dependent is an eligible student and you. Tax forms 2012 federal . Tax forms 2012 federal . Tax forms 2012 federal AND. Tax forms 2012 federal . Tax forms 2012 federal . Tax forms 2012 federal THEN. Tax forms 2012 federal . Tax forms 2012 federal . Tax forms 2012 federal 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. Tax forms 2012 federal Your dependent cannot take a deduction. Tax forms 2012 federal claim an exemption for your dependent your dependent paid all qualified education expenses no one is allowed to take a deduction. Tax forms 2012 federal do not claim an exemption for your dependent you paid all qualified education expenses no one is allowed to take a deduction. Tax forms 2012 federal do not claim an exemption for your dependent your dependent paid all qualified education expenses no one is allowed to take a deduction. Tax forms 2012 federal Expenses paid by dependent. Tax forms 2012 federal   If your dependent pays qualified education expenses, no one can take a tuition and fees deduction for those expenses. Tax forms 2012 federal Neither you nor your dependent can deduct the expenses. Tax forms 2012 federal 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. Tax forms 2012 federal This rule applies even if you do not claim an exemption for your dependent on your tax return. Tax forms 2012 federal Expenses paid by you. Tax forms 2012 federal   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. Tax forms 2012 federal Expenses paid under divorce decree. Tax forms 2012 federal   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. Tax forms 2012 federal 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. Tax forms 2012 federal Expenses paid by others. Tax forms 2012 federal   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. Tax forms 2012 federal In this case, the student is treated as receiving the payment from the other person and, in turn, paying the institution. Tax forms 2012 federal 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. Tax forms 2012 federal If the student is not a dependent, only the student can deduct payments made directly to the institution for his or her expenses. Tax forms 2012 federal If the student is your dependent, no one can deduct the payments. Tax forms 2012 federal Example. Tax forms 2012 federal In 2013, Ms. Tax forms 2012 federal Baker makes a payment directly to an eligible educational institution for her grandson Dan's qualified education expenses. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal If someone else can claim an exemption for Dan, no one will be allowed a deduction for Ms. Tax forms 2012 federal Baker's payment. Tax forms 2012 federal Tuition reduction. Tax forms 2012 federal   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. Tax forms 2012 federal 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. Tax forms 2012 federal For more information on tuition reductions, see Qualified Tuition Reduction , in chapter 1, Scholarships, Fellowships, Grants, and Tuition Reductions. Tax forms 2012 federal 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. Tax forms 2012 federal See Effect of the Amount of Your Income on the Amount of Your Deduction , later. Tax forms 2012 federal Form 1098-T. Tax forms 2012 federal   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). Tax forms 2012 federal 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. Tax forms 2012 federal An institution may choose to report either payments received (box 1), or amounts billed (box 2), for qualified education expenses. Tax forms 2012 federal However, the amount in boxes 1 and 2 of Form 1098-T might be different than what you paid. Tax forms 2012 federal When figuring the deduction, use only the amounts you paid in 2013 for qualified education expenses. Tax forms 2012 federal   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. Tax forms 2012 federal    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. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal No tuition and fees deduction is allowed if your MAGI is larger than $80,000 ($160,000 if you are married filing jointly). Tax forms 2012 federal Modified adjusted gross income (MAGI). Tax forms 2012 federal   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. Tax forms 2012 federal However, as discussed below, there may be other modifications. Tax forms 2012 federal MAGI when using Form 1040A. Tax forms 2012 federal   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). Tax forms 2012 federal MAGI when using Form 1040. Tax forms 2012 federal   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. Tax forms 2012 federal   Table 6-2 shows how the amount of your MAGI can affect your tuition and fees deduction. Tax forms 2012 federal   You can use Worksheet 6-1. Tax forms 2012 federal MAGI for the Tuition and Fees Deduction , later, to figure your MAGI. Tax forms 2012 federal Table 6-2. Tax forms 2012 federal Effect of MAGI on Maximum Tuition and Fees Deduction IF your filing status is. Tax forms 2012 federal . Tax forms 2012 federal . Tax forms 2012 federal AND your MAGI is. Tax forms 2012 federal . Tax forms 2012 federal . Tax forms 2012 federal THEN your maximum tuition and fees deduction is. Tax forms 2012 federal . Tax forms 2012 federal . Tax forms 2012 federal single,  head of household, or qualifying widow(er) not more than $65,000 $4,000. Tax forms 2012 federal more than $65,000  but not more than $80,000 $2,000. Tax forms 2012 federal more than $80,000 $0. Tax forms 2012 federal married filing joint return not more than $130,000 $4,000. Tax forms 2012 federal more than $130,000 but not more than $160,000 $2,000. Tax forms 2012 federal more than $160,000 $0. Tax forms 2012 federal Claiming the Deduction You claim a tuition and fees deduction by completing Form 8917 and submitting it with your Form 1040 or Form 1040A. Tax forms 2012 federal Enter the deduction on Form 1040, line 34, or Form 1040A, line 19. Tax forms 2012 federal A filled-in Form 8917 is shown at the end of this chapter. Tax forms 2012 federal Illustrated Example Tim Pfister, a single taxpayer, enrolled full-time at a local college to earn a degree in engineering. Tax forms 2012 federal This is the first year of his postsecondary education. Tax forms 2012 federal During 2013, he paid $3,600 for his qualified 2013 tuition expense. Tax forms 2012 federal Both he and the college meet all of the requirements for the tuition and fees deduction. Tax forms 2012 federal Tim's total income (Form 1040, line 22) and MAGI are $26,000. Tax forms 2012 federal He figures his deduction of $3,600 as shown on Form 8917, later. Tax forms 2012 federal Worksheet 6-1. Tax forms 2012 federal 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. Tax forms 2012 federal 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. Tax forms 2012 federal 1. Tax forms 2012 federal Enter the amount from Form 1040, line 22   1. Tax forms 2012 federal         2. Tax forms 2012 federal Enter the total from Form 1040, lines 23 through 33   2. Tax forms 2012 federal               3. Tax forms 2012 federal Enter the total of any amounts entered on the dotted line next to Form 1040, line 36   3. Tax forms 2012 federal               4. Tax forms 2012 federal Add lines 2 and 3   4. Tax forms 2012 federal         5. Tax forms 2012 federal Subtract line 4 from line 1   5. Tax forms 2012 federal         6. Tax forms 2012 federal Enter your foreign earned income exclusion and/or housing  exclusion (Form 2555, line 45, or Form 2555-EZ, line 18)   6. Tax forms 2012 federal         7. Tax forms 2012 federal Enter your foreign housing deduction (Form 2555, line 50)   7. Tax forms 2012 federal         8. Tax forms 2012 federal Enter the amount of income from Puerto Rico you are excluding   8. Tax forms 2012 federal         9. Tax forms 2012 federal Enter the amount of income from American Samoa you are  excluding (Form 4563, line 15)   9. Tax forms 2012 federal         10. Tax forms 2012 federal Add lines 5 through 9. Tax forms 2012 federal This is your modified adjusted gross income   10. Tax forms 2012 federal     Note. Tax forms 2012 federal 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. Tax forms 2012 federal       This image is too large to be displayed in the current screen. Tax forms 2012 federal Please click the link to view the image. Tax forms 2012 federal Form 8917 for Tim Pfister Prev  Up  Next   Home   More Online Publications