Question

Tuition, education amounts... increase tax owed

Forum|Forum|6 years ago
March 4, 2020
2 replies
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I am in the middle of my son's return. He didn't make but much more than $15K which barely covered his rent, tuition and expenses while away at school. Before I enter the $1700 in tuition, his refund amount is just over $2100, when I enter the amount, instead of increasing, his refund drops to just over $1300. The lead in to the Education section, says "let's get you some tax breaks", however it does not seem the case. Why is this happening? If we leave his tuition amount out of the return, he gets a bigger refund. Someone please explain why someone should get punished and have a refund reduced for going to school? His brother who didn't go to school this year and made roughly the same amount, has a bigger refund.

TurboTax Basic Windows

X

xmasbaby0

Employee

Wait---how old is your son? Is he a full-time student under the age of 24? If so he can be claimed as a dependent on a parents' return--and the education credit goes on the parent's return.

WHO CAN I CLAIM AS A DEPENDENT?

You can claim a child, relative, friend, fiance (etc.) as a dependent on your 2019 taxes as long as they meet the following requirements:

Qualifying child

• They are related to you.

• They cannot be claimed as a dependent by someone else.

• They are a U.S. citizen, resident alien, national, or a Canadian or Mexican resident.

• They are not filing a joint return with their spouse.

• They are under the age of 19 (or 24 for full-time students).

No age limit for permanently and totally disabled children

• They live with you for more than half the year (exceptions apply).

Qualifying relative

• They don't have to be related to you (despite the name).

• They cannot be claimed as a dependent by someone else.

• They are a U.S. citizen, resident alien, national, or a Canadian or Mexican resident.

• They are not filing a joint return with their spouse.

• They lived with you the entire year.

• They made less than $4200 (not counting Social Security)

• You provided more than half of their financial support. More info

When you add someone as a dependent, we'll ask a series of questions to make sure you can claim them.

Related Information:

• Does a dependent have to live with me?

• What does "financially support another person" mean?

• Can I claim a newborn baby?

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

SusanY1

There are a number of tuition related deductions and credits and TurboTax isn't able to fully incorporate many of them until the end of the education section.

It may be that the calculation isn't complete when you are seeing this decrease in the refund. This is one of the most complex areas of the tax code and in the program. It often takes a while for the program to fully incorporate all of the necessary data for the refund to be accurately displayed.

Is there a box 5 scholarship amount on his Form 1098-T that is greater than the amount in Box 1 Tuition? If so, and adjustments haven't yet been entered the program is likely seeing taxable scholarship income at the time of that entry, absent other entries.

Many times, these numbers require some additions and adjustments in the interview section and the refund will adjust, often drastically, once it is complete.

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