What Tax Breaks Can Students Claim When Filing Taxes?

[dreiter]

I am wondering if anyone here could provide some information about filing taxes as a student? It's my first year doing it, and I am wondering what tax breaks I am eligible for. I have been reading "this"[/URL] but I'm not quite sure which items I benefit for and which will give me the most benefit! I figured there must be a few students on here who file. Any help would be appreciated! :D

I only earned $700 in income last year (workstudy) and everything else was loans and grants. My questions are:
1. Do I qualify for a tax credit AND a tax deduction?
2. Will a tax deduction even do anything for me?
3. What credit/deduction is the best for most students?
4. Can I use a 1040EZ with a credit/deduction or must I file a 1040A?
5. Did the stimulus bill/education bill provide anything new for this year?

 

[D H]

I only earned $700 in income last year (workstudy) and everything else was loans and grants.

Some of those grants may be taxable. You had better check; it may bump your income a lot (not hard with only $700 in income).

My questions are:
2. Will a tax deduction even do anything for me?

Regarding deductions, all you need is the standard deduction -- if you are eligible. Are your parent(s) claiming you as a deduction?

5. Did the stimulus bill/education bill provide anything new for this year?

Yes, big time. You, or your parent(s), really, really want to look into the American Opportunity Credit. That includes a "refundable" credit. So WTF is a refundable credit? You probably paid next to nothing in taxes on that $700 income. A refundable credit means you can receive a "refund" on money you never paid to the IRS. Disguised welfare, but do take advantage of it.

If your parent(s) can claim you as a deductable, they, rather than you, are the ones who can claim this credit.

 

[BishopUser]

Are you able to claim the american opportunity credit for tuition that was paid for by government loans/grants?