Who Claims the Deduction?

• A taxpayer must have paid the student's educational expenses and be able to claim an exemption for the student as a dependent in order to claim the tuition and fees tax deduction. For example, if your grandmother paid your tuition, but she cannot claim you as a dependent, she cannot deduct your educational expenses on her tax return.
  
  In some instances, the student can claim the exemption himself if his parents or legal guardian fails to meet all of the eligibility requirements, even if they paid his tuition. For example, if your parents paid your tuition, but they earn more than the maximum adjusted gross income, their tuition payments are treated as a gift, and you can claim the deduction yourself. However, a dependent student and his parents cannot claim the tuition and fees tax deduction at the same time for the same educational expenses.
  
  

Benefits and Eligibility Requirements

• Taxpayers can claim a maximum of $4,000 in education expenses using the tuition and fees tax deduction. The deduction allows taxpayers to subtract the amount claimed from their pre-tax income. You can earn an adjusted gross income of no more than $160,000 as a married couple filing jointly and single taxpayers can earn no more than $80,000 to be eligible for the deduction. If you use the married filing separately status to file your tax return, you cannot claim the tuition and fees tax deduction.
  
  

Mandatory Expenses

• Under the tuition and fees tax deduction, only educational costs that are mandatory for enrollment at an educational institution are eligible for deduction. This consists of expenses such as tuition, student lab fees, course-related supplies, books and equipment and any additional fees required for enrollment. Personal living expenses such as room and board or medical insurance do not qualify for deduction, even if they are paid to your educational institution. Educational expenses paid via tax-free aid, such as a grant or scholarship, are not eligible for deduction.
  
  

How to Claim the Deduction

• You must submit a Form 1098-T tuition payments statement to claim the tuition and fees tax deduction. According to the IRS, you should receive this form from your educational institution no later than January 31 of the tax year. You can also print a copy of this form at the IRS website.