Is there a way to claim college tuition on your taxes if you don't itemize deductions?

Question

If I want to pay college tuition for my son, 26, who lives in another state and is not my dependent, can I claim this on my taxes next year? I don't itemize deductions. I remember seeing something about college tuition on page 1 of the 1040 form when I last did my taxes -- so if it's on page 1, that's not itemizing, right? And if I can claim it, how does it work? Will it reduce my taxable income by the amount of the tuition? Or is there some formula and you only get credit for a fraction of it? I currently claim head of household standard deduction. How can I work out how much taxes I'll save for each dollar paid in tuition?

Answer 1

Claiming an education credit doesn't require someone to itemize.  But if you are claiming it for someone other that yourself, that person must be your dependent, so no you won't be able to claim an education credit for money you pay for your son's tuition.  He might be able to claim it, though.

Answer 2

You cannot get a federal income tax benefit by paying a nondependent's college tuition.  

However, if you give your child the money for college tuition, and he pays college tuition with it, he can get a tax benefit.

The benefit is taken by using the Tuition and Fees Deduction or an education credit (Hope or Lifetime Learning).  These benefits do not require that the taxpayer itemize.  

The benefit can be from zero percent up to 100 percent of the expenses paid, depending on the taxpayers tax circumstances, the amount of expenses paid, and the benefit used.

Or, you could establish a 529 plan for your child, by funding the account with the college tuition money, and then using that money to pay the tuition.  This will not give you a federal income tax benefit, but it may give you a state tax benefit depending on the state you live in.

Answer 3

No, you cannot claim that on your return.  He is not your dependent and to be eligible for the educational credits or tuition deduction you must pay the costs for yourself or a dependent claimed on your return.

What you CAN do is gift him the tuition and let him pay the bills himself and take the credits or deductions himself.  As long as you gift him $12,000 or less per year there are no Gift Tax return filing requirements.  Even if you gift more than that, your $1,000,000 lifetime exclusion will probably avoid any Gift Tax on your part.  The gifts are entirely tax free to him as long as they are a bona-fide gift with no strings attached.  Be very careful with that, since if you attach the string that the money be used for tuition then it's taxable income to him.  If he takes the money and buys a car, there's nothing that you can do, aside from refuse any future help.