Lupe paid the following expenses during December 2014 for her son David's spring 2015 college expenses.The semester begins in February 2015. In addition,David's grandfather paid $500 in fees on behalf of David directly to the college.David is claimed as a dependent on Lupe's tax return.How much of the above expenses qualify for purposes of Lupe's education credit deduction in 2014?

Question

Lupe paid the following expenses during December 2014 for her son David's spring 2015 college expenses.The semester begins in February 2015.  In addition,David's grandfather paid $500 in fees on behalf of David directly to the college.David is claimed as a dependent on Lupe's tax return.How much of the above expenses qualify for purposes of Lupe's education credit deduction in 2014?

Quizplus · Accepted Answer

The expenses paid by Lupe for David's spring 2015 college expenses qualify for the American Opportunity Credit only if they were paid by Lupe in the tax year 2014. As per the question, the expenses were paid in December 2014, which is in the tax year 2014. Therefore, the total expenses paid by Lupe in December 2014 for David's college expenses are $16,000.

However, the $500 that David's grandfather paid directly to the college on behalf of David cannot be included in the education credit deduction as it is not paid by Lupe. Therefore, the qualified education expenses for the American Opportunity Credit are $16,000.

Lupe Paid the Following Expenses During December 2014 for Her