Filling Taxes? Here’s How College, Jobs, Marriage or the Birth of a Child Changes Things.
When it comes to filing your taxes, it’s important to be aware of different tax credits you can receive. A new milestone in life is exciting! Congratulations on your new adventure. From going to college, tying the knot, to having your first child—there are tax credits around every corner. Give these helpful reminders a read, so you don’t miss out when you file your taxes.
Going to college.
The American Opportunity Tax Credit (AOPTC) is a tax credit offered to eligible students for education expenses paid during their first four years of college. You claim up to a maximum of $2,500 per year for four years. Students may also qualify for the Lifetime Learning Tax Credit up to a maximum of $2,000 per year. Note: You cannot combine the American Opportunity and Lifetime Learning Tax Credit during the same year.
The Internal Revenue Service (IRS) offers tax benefits for education under a variety of categories, so make sure to file your taxes correctly and accurately. To file for this credit, you’ll need a 1098-T qualified educational expense form which you’ll receive from your university. You might also be able to claim the interest paid on your student loans as a tax deduction, you can read more about this here.
Starting or Ending Employment.
Your W-4 form plays a crucial role when filing taxes, especially when you have more than one job or if you changed employers. It’s very important you file your taxable and nontaxable income.
Getting married, separated or divorced.
Getting married can change the way you file your taxes based on whether you file jointly or separately. Make sure you understand the differences before you file.
Having a Child.
The birth of a child also changes how you file your taxes. Here’s criteria you must know in order to claim your children as dependent on your tax return. Depending on your income, you might be eligible for an exemption on each child. You may also be able to claim the dependent care credit.
These are just few of many life events that impact your taxes according to the IRS. As college student, do your best to learn how taxes work, so you can file your taxes accurately.