Reef nutrition

Tax Time!

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sfsuphysics

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To anyone out there who knows taxes... ahem Bryan... is it possible to deduct college tuition paid for someone else/non-family?

There's a bunch of paperwork the university sent, but I don't know if I can claim that as me paying it.
 
I don't think I can classify it as a donation, but an investment such that my future wife will have a good paying job and I can keep the reef tanks :D
 
No it is not possible to write it off. As a matter of fact it is not possible to write it off for yourself.

There are some deductions for student loan interest but it phases out very quickly.
 
What about writing off my computer since I mainly use it for work? Since I'm not a private contractor, can I do that?
 
Computers (like cars) are considered listed property. The get into that grey area as far a deductibility. If you are a W-2 employee even if you could take it you are subject to the miscelaneous itemized deduction floor (2% of AGI) and probably would net you nothing.
 
Sorry.

So because you are not an independent contractor, any unreimbursed business expenses go as itemized deductions (in the miscellaneous itemized deduction category). Miscellaneous itemized deductions are disallowed until they exceed 2% of your adjusted gross income (2% floor). If you exceed the 2% floor, then you are allowed a deduction for any amounts over the 2%

For example if your income was $100,000 from a W-2 and that was all you had, you would need more then $2,000 of unreimbursed business expenses before you could actually get a deduction. Thus if you had $2,500 of expenses you would get a deduction of $500.

Listed property is subject to limitations based on business vs. personal use. It is a little complicated to just sum up in a thread but ultimately you apply the business % to the asset and depreciate it over 5 years to get the amount that would be your unreimbursed business expense.

For example you buy a $3,000 computer in 2008 (again this is a simplified example and I am using a simple method of depreciation for this purpose). If your business us % was 80% then your depreciable asset is $2,400. Computer equipment has a 5 year useful life according to the IRS. Thus the amount for your unreimbursed business expense (subject to the limitation discussed above) for 2008 would be $480.

Again this is a simple example and the numbers are not completely accurate as depreciation is not a simple as taking the value and dividing by the useful life. However, it should at least give you some idea.
 
Forgot to add in the " You should consult your tax advisor for more specifics" disclaimer. I can talk to you about it at the swap if you want Gresham.
 
you might be able to write it off, is this person living in your household, a dependent or a girlfriend? Are they filing taxes too?

Check out the Life Long Learning Credit or if this student is in their first or second year of college the Hope Credit.

http://www.ed.gov/offices/OPE/PPI/HOPE/index.html

Lifetime Learning Credit for College Juniors, Seniors, Graduate Students and working Americans pursuing lifelong learning to upgrade their skills. For those beyond the first two years of college, or taking classes part-time to improve or upgrade their job skills, the family will receive a 20% tax credit for first $5,000 of tuition and fees through 2002, and for the first 10,000 thereafter. The credit is available for net tuition and fees (less grant aid) paid for post-secondary enrollment after June 30, 1998. The credit is available on a per-taxpayer (family) basis, and is phased out at the same income levels as the HOPE Scholarship.
 
PS: For these two deductions you just need the cost of tuition/fees, what the university billed you(family), and any info on scholarships grants, if they received a 1098-T its all there, no need to itemize anything, since its just the tuition/fees. Books, computers, etc don't count UNLESS the University requires the student to buy them (some schools make freshman buy a computer, some classes require lab supplies or books).

Cheers,

Josh
 
Gresham,

Do you travel for work? If you are in the "marine" business, you could probably write off all "marine" travel expenses, and if a computer is necessary for your job (graphic designing?) that should count too and it would be worthwhile write off if you included with travel expenses since now you will probably be hitting close to $10,000.

Cheers,

Josh
 
[quote author=MontanaBay link=topic=6248.msg80940#msg80940 date=1234541077]
you might be able to write it off, is this person living in your household, a dependent or a girlfriend? Are they filing taxes too?

[/quote]yes, yes, no
however she's not a child/spouse so I don't think it's possible.
 
[quote author=MontanaBay link=topic=6248.msg80945#msg80945 date=1234541869]
Gresham,

Do you travel for work? If you are in the "marine" business, you could probably write off all "marine" travel expenses, and if a computer is necessary for your job (graphic designing?) that should count too and it would be worthwhile write off if you included with travel expenses since now you will probably be hitting close to $10,000.

Cheers,

Josh
[/quote]

If the company paid for the travel expense, how can he claim them??
 
if she is NOT filing taxes or makes less then $3500, but lives with you full time she would qualify as an adult dependent and you could write her off as such and also you can came one of the Education credits (lifelong or Hope).

http://turbotaxblog.typepad.com/turbotax_blog/2009/01/who-counts-as-your-dependent-you-might-be-surprised.html

If you claim an adult as a dependent, that person must meet several IRS qualifications:



· Had less than $3,500 of gross income during 2008.

· Received more than half of his or her support from you for the year.

· Did not file a joint income tax return for 2008 with anyone else.

· Is a citizen or resident of the United States, or a resident of Canada or Mexico.

· Is a member of your household for the full year, or a relative who does or does not live with you.
 
legal note: I am not a tax specialist all my advice should be run by a professional, certified tax associated or assume all risk!

I just did my taxes, since I'm a grad student I got the Lifelong Learning Credit and I live with my girlfriend, who I also looked into as claiming as a dependent.

File at your own risk!

Josh
 
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