Tax Topic 12 - Education and Education Tax Credits

In this tax topic you will learn the the different tax treatment of various types of educational assistance. In addition, you will review the tax benefits that may be available to you if you are saving for or paying education costs for yourself or other students in your immediate family. In addition, you will also learn how and when to you can take business deductions for work-related education and the educational tax credits available to your for higher education.

Tax School Homepage

Student Instructions:

Print this page, work on the questions and then submit test by mailing the answer sheet or by completing quiz online.

Instructions to submit quiz online successfully: Step-by-Step check list

Answer Sheet            Quiz Online

Most forms are in Adobe Acrobat PDF format. You will need Adobe Reader to view and print these forms. If you do not already have Adobe Reader installed on your computer, you may download the software for free.

 

Use IRS Publication 970, and Form 1040 Instructions (Form 1040 instructions only up to page 98) to complete this tax topic.

Please note: Form 1040 Instructions (Form 1040 instructions only up to page 98) will be used for the rest of the topics in the initial tax preparer certification course. You will be responsible to answer questions from the Form 1040 instructions booklet (up to page 98) on every topic so read it carefully.

Complete  Form 1040, Form 8863 for this topic.

Maria's family goes to school.

	Maria's daughter, Leticia Gonzalez,  paid $2,000 for tuition fees for herself to attend a qualifying community college full time. Leticia had expenses used to claim the Hope credit in the previous two years.
	Her son, Raul Gonzalez, also paid $1,800 tuition fees to attend the same community college full time. However, Raul only attended school for about a month, and he was not eligible for a refund of fees paid.
	Her children are her dependents and she claims them on her return.
	Leticia's SSN is 555-10-7500 and her date of birth January 20, 1994.
	Raul's SSN is 555-10-7501 and his date of birth February 20, 1995.
	This is the first year Raul attends college. Both Leticia and Raul are enrolled to pursue their degrees.

Maria is a not married. She provides a home for her son and daughter. She is the only one that can claim her children and provided for her family by herself. No one can claim her or her children as dependents.

She paid rent all year for a of $9,600.00.

Maria received a tax-free scholarship from Women for Education Inc. The amount she received was $3,000 towards her studies to get a nursing degree at the same community college her kids attend. All the money was for enrollment and attendance as specified by the school.

Get all basic information from the following W2, including income information.