However, filing taxes needs to be a priority, especially if you had a job for the past year (work-study jobs included) and are currently going to college, because you could potentially save money on your education costs. Also, if you’ve earned interest from bank accounts, have used scholarship or financial aid money for something other than tuition or textbooks, or if you’re not a US resident and are here on a visa, then you definitely should file your taxes.
Credits & Deductions: What You Need to Know
In terms of higher education, there are two tax credits available to most students to help with the costs of college and one additional credit available to first/second year students. These deductions are the American Opportunity credit and the Lifetime Learning credit. Students can only choose one credit, even if they are eligible for both, and there are some limitations to look into. If you’re a freshmen or sophomore, you may also be eligible for the Hope Scholarship credit.
There are also some options for tax deductions that are relevant to college students. If you receive financial aid and have a qualifying income, then you may be eligible for the Student Loan Interest deduction. The Tuition and Fees deduction could allow you to deduct up to $4,000 in tuition and fees.
Also, don’t forget to deduct your moving expenses on your taxes if you go to a school that is far away from your home and you work full-time. There are specifics that go along with the moving expenses, but it’s definitely worth looking into if you work full time and attend school a long-distance from your hometown.
If you’re a recent grad or looking for a full-time job, then you may be eligible for some additional deductions. These deductions, which are not always talked about and are relevant to students are employment and outplacement agency fees, costs of typing, printing, and mailing copies of your resume, and travel/transportation expenses if you need to travel for an interview.
You can read more about credits and deductions and learn how to claim them here.
Get free personalized tax advice online with the free edition, which allows you to file your federal taxes for free, but does cost an additional fee for state taxes. Also, you can download the iPhone/Android app (SnapTax) for free and pay $14.99 when you’re ready to e-file your returns. Check out this funny video of a dog filing taxes using this app!
Also a free edition, H&R Block® includes federal taxes with an additional fee for state taxes. This tool provides the option to file online, in an H&R Block office location, or live via telephone.
Similar to TurboTax® and H&R Block®, TaxACT® also allows you to file your federal returns for free. You may recognize this tool from their hilarious “Free to Pee” Super Bowl ad, which you can check out here.
The Essentials: Where, When, How
Now that you’re armed with the inside scoop on deductions and credits, as well as the tools of the trade, you’re ready to file! April 15th of each year is the due date for filing federal tax returns. The returns need to be postmarked by this date, so just like with a final term paper or project, don’t procrastinate! Check out the details on where to file and how to file your tax returns here.
Filing taxes might seem like a daunting task that could easily be pushed to the bottom of your to-do list. However, it is an important yearly responsibility that must be completed and if you do it correctly, you could potentially end up saving a ton of money and maybe even getting back some money to spend as you choose!
Good luck taking on the tax season!
- www.irs.gov (IRS Website)
- “SnapTax Mobile App – Snap it! File it! Done!” (TurboTax Blog)
- “Surviving College and Tax Season: 7 Tips for Students” (TurboTax Blog)
- “Federal Tax Benefits Help You Pay for College” (Back to College blog)