Back-to-School Tax Tips for Students and Parents

Here is a word from the Goodfellas at the IRS:

IRS Summertime Tax Tip 2013-19

Going to college can be a stressful time for students and parents. The IRS offers these tips about education tax benefits that can help offset some college costs and maybe relieve some of that stress.

• American Opportunity Tax Credit. This credit can be up to $2,500 per eligible student. The AOTC is available for the first four years of post secondary education. Forty percent of the credit is refundable. That means that you may be able to receive up to $1,000 of the credit as a refund, even if you don’t owe any taxes. Qualified expenses include tuition and fees, course related books, supplies and equipment. A recent law extended the AOTC through the end of Dec. 2017.

• Lifetime Learning Credit. With the LLC, you may be able to claim up to $2,000 for qualified education expenses on your federal tax return. There is no limit on the number of years you can claim this credit for an eligible student.

You can claim only one type of education credit per student on your federal tax return each year. If you pay college expenses for more than one student in the same year, you can claim credits on a per-student, per-year basis. For example, you can claim the AOTC for one student and the LLC for the other student.

You can use the IRS’s Interactive Tax Assistant tool to help determine if you’re eligible for these credits. The tool is available at IRS.gov.

• Student loan interest deduction. Other than home mortgage interest, you generally can’t deduct the interest you pay. However, you may be able to deduct interest you pay on a qualified student loan. The deduction can reduce your taxable income by up to $2,500. You don’t need to itemize deductions to claim it.

These education benefits are subject to income limitations and may be reduced or eliminated depending on your income.

For more information, visit the Tax Benefits for Education Information Center at IRS.gov. Also, check Publication 970, Tax Benefits for Education. The booklet’s also available at IRS.gov or by calling 800-TAX-FORM (800-829-3676).

IT'S COMING......

Tax Organizer for Truckers

 

KEY EXPENSES FOR OVERNIGHT DRIVERS

A)   TRAVEL – OUT OF TOWN:

Expenses of traveling away fro “home” overnight for job-related reasons are deductible. Your “home” is generally considered to be the entire city or general area where your principal place of employment is located. Out-of-town expenses include transportation, meals, lodging, tips, and miscellaneous items like laundry, valet, etc.

Document your away-from-home expenses by nothing the date, destination, and business purpose of your trip. In addition, keep a detailed record of your expenses-lodging, public transportation, meals, etc. Always list meals and lodging separately in your record. Receipts must be retained for each lodging expense. However if any other business expense is less than $75, a receipt is not necessary if you record all the information in a timely diary. Keep track of the full amount of meal and entertainment expenses even though only a portion of the amount may be deductible.

B)   OFFICE EXPENSES:

Use this section to record miscellaneous expenses of supplies and services you are responsible for when you are on the road. For example, you may be required to fax or mail an important document back to your home office; such expensive is deductible if it is not reimbursed by your employer.

C)   SUPPLIES:

Generally to be deductible, items must be ordinary and necessary to your job. If you are an employee, only amounts not reimbursable by your employer are deductible. Record separately from other supplies, items costing over $100 and having a useful life of more than one year. These items must be recovered differently on you tax return than recurring everyday business expenses like maps, etc.

If you are required to wear a uniform, the cost and upkeep may be deductible. IRS rules specify that expense for work clothing and its maintenance is deductible if: (1) the uniforms are required by your employer (if you are an employee); and (2) the clothes are not adaptable to ordinary street wear.

D)   COMMUNICATION EQUIPMENT:

Since special rules apply to deductions for cellular and similar items (called “listed property” in the tax rules), it is important to track their business and personal use carefully. Such property potentially qualifies for larger current deductions when it’s used more than 50% for business. Keep your bills for cellular phone use and mark all business calls.

E)   FEES & DUES:

Union or other professional dues are deductible. Amounts paid to a union which are mean to go toward defraying your personal expenses are not deductible. However, any part of union payments which go into a strike fund is deductible.

G)   MISCELLANEOUS EXPENSES:

Use this section to record expenses that don’t easily fit to other categories. For example, if you look for a job in the same line of work, you may deduct the expenses. Such expenses could include mileage to interviews, resume preparation, etc.        

TRAVEL – AWAY FROM HOME Airfare   Bath & Shower   Bus & Subway   Car Rental   Laundry   Laundry Supplies   Locker Fees   Lodging (do not combine with meals)   Meals – Actual Cost (do not combine with lodging)   Number of Days Away From Home   Parking   Taxi   Telephone   Tips, Porter, Bagging Handling, etc.   Tolls   Toiletries   Train   Other:   Other:     SUPPLIES Compass   Ice Cheat   Maps   Map Book   Thermos   Tools   Trade Publications   Uniforms   Uniform Cleaning   Uniform Repairs   Other   Other   Other     MISCELLANEOUS EXPENSES Business Cards   Insurance – Business   Legal & Professional Services   Publications - Trade   Subscriptions   Testing – Job Related   Other:

SAFETY EQUIPMENT
Apron
Back Supporter (Belt)
Batteries
Fire Extinguisher
First Aid Kit
Flares
Flashlight
Glasses – Safety
Glasses - Sun
Gloves – Driving
Gloves – Work
Seat Cushion
Shoes/Boots – Safety
Other:
Other:

COMMUNICATION EQUIPMENT
Beeper
Cellular Phone
Citizens Band Radio
Long Range Communications
Radio
Weather Receiver
Other

OFFICE EXPENSES
FAX Expenses
Fed-X, UPS, etc.
Office Supplies
Postage
Secretarial
Stationary
Other:
Other:

FEES & DUES
Association Dues
License
Security Bond
Travel Card Fees
Union Dues
Other:
Other: