Wednesday, August 28, 2019
RECORDKEEPING FOR COLLEGE
If you have a child beginning college this fall be sure to have him or her save and give to you the receipts for all textbook purchases. If purchased online have them print hard copies of the receipts. The American Opportunity Credit, available for the first 4 calendar years of undergraduate education, allows you to include the cost of books with tuition and fees in calculating the credit.
You should also save, again in hard copy, the bills, receipts and “Bursar’s Statements” that itemize the individual charges for tuition, fees, room and board, and other items and amounts and sources of payments. You should receive a Form 1098-T from the school in January of 2020, but these forms do not always provide all the information you may need.
If you are paying separately for off-campus lodging for your student while away from home at college keep track of these payments also.
In addition to claiming an American Opportunity Credit, or a Lifetime Learning Credit, if you have used withdrawals from a Section 529 Qualified Tuition Program to pay for all or some of the college expenses the detailed information of expenses and payments will be needed.
If your level of income turns out to be too high to claim a full American Opportunity Credit your student child may be able to claim a credit on his or her tax return if they have sufficient income to have to pay tax.