This is random, but does anyone know if the money we spent on applications (and travel to intereview, etc.) counts in our taxes? I got my 1098 for the money I spent on actual tuition but is there somewhere where we can write off expenses for future educational endeavors?!
Random Tax Write-off Question
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Thanks jblil!
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Another tax question. If I put a deposit down at a school and that money is used towards my tuition, can I write that off?
You cannot "write off" your tuition.
However, there is something called the "American Opportunity Tax Credit" that will lower your taxes if you fulfill the requirements. The maximum for this tax credit is $2,500. If you use tax software (TurboTax, TaxAct, etc), it will guide you through the steps for claiming it.
A tax credit is very beneficial in that it is applied directly against your taxes. For ex., let's say you have finished your tax return and end up owing $4,000 in taxes. If you qualify for a tax credit of $2,500, it will lower your taxes and you only owe $1,500.
I highly encourage all of you to prepare your own taxes, so you better understand how the money flows. TaxAct offers free preparation, printing and e-filing, no gimmicks or restrictions.
This advice is for when you'll graduate and start making big bucks: always do your own taxes. When you go to a tax preparer, you want advice, e.g. how to structure certain payments, deals or purchases if you have a private practice. 90% of the low-cost tax preparers on the market (you know whom I'm taking about) are only "mechanics" who type your info into the software. You can do the typing yourself. Pay for advice and not for data entry. I'll get off my soapbox now.
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Very helpful. Thanks!
