Claiming the Lifetime Learning Tax Credit is a huge tax break to first-year interns. You get to claim a tax credit equal to 20% of the first $10k paid for tuition, required fees, and certain other expenses during the calendar year. Remember, a tax credit is a dollar for dollar reduction is the taxes you owe, so if you paid at least $10k in tuition during 2007,
your tax refund will increase by $2k thanks to this tax break.
To claim this credit, you can't be claimed as a dependent on your parent's tax return. If you took out loans to pay for your tuition, you calculate this tax credit based on the year in which the expenses are paid, and not when the loans are repaid.
There is an income limit for this tax credit. Single individuals with income greater than $57k, and married couples with income greater than $114k during 2007 are out of luck. More info about the Lifetime Learning Credit can be found in the instruction to the IRS form 8863 or IRS Publication 970, available at
www.irs.gov.