1040 - Tuition and Fees Deduction Rules



Where can I deduct Tuition and Fees?
 
The Tuition and Fees Deduction, previously claimed on Form 1040, line 34 or Form 1040A, line 19, had expired on December 31, 2016 and was not extended by Congress until February 9, 2018 (retroactively). As of 02/20/2018, Drake17 has been updated to allow entry and selection of the Tuition and Fees Deduction on the 8917 screen.  

Note: This deduction expired December 31, 2017. At this time, It has not been decided if the Tuition and Fees Deduction will or will not be available for Tax Year 2018.
Line 34 of Form 1040, Schedule 1 currently shows as "reserved" in case congress chooses to extend the deduction.

To claim this deduction in Drake17, enter the amount on the 8863/8917 screen in the field that states Total Qualified Educational Expenses (including the price of Books, Supplies, and Equipment) that were REQUIRED to be paid directly to the Educational Institution. Once this is entered, if you want to take the Tuition and Fees Deduction, check the box to the right for Tuition and Fees.

The deduction limit is $4000 per taxpayer.

Rules:

  • MAGI must be less than $80,000 S-HOH-QW or $160,000 MFJ.
  • If the MAGI is larger than $65,000 ($130,000 MFJ), the maximum deduction per taxpayer is $2000.
  • Cannot be claimed with American Opportunity or Lifetime Learning Credit for the same student in the same year.
  • Cannot be claimed in MFS return.
  • The student
    • cannot be the dependent of another.
    • cannot be a nonresident alien for tax purposes.

Note: MAGI is AGI + certain amounts, so if the AGI (line 37) is already over the limit the taxpayer won’t qualify for the credit/deduction.

For Drake15 and earlier, enter the deduction on screen 8917 in the field Enter current-year qualifying expenses to force the tuition and fees deduction.

See Pub. 970, Tax Benefits for Education.