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The IRS site says the deduction is taken as an adjustment to income on Form 1040. I believe this would be your modified adjusted gross income. This would be line 22 on 1040A or line 38 on Form 1040. You would figure the tuiton into your adjusted gross income. The IRS site says quote: If your modified adjusted gross income (MAGI) is not more than $65,000 ($130,000 if you are married filing jointly), your maximum tuition and fees deduction is $4,000. If your MAGI is larger than $65,000 ($130,000), but is not more than $80,000 ($160,000 if you are married filing jointly), your maximum deduction is $2,000. No tuition and fees deduction is allowed if your MAGI is larger than $80,000 ($160,000).
Modified adjusted gross income (MAGI). For most taxpayers, MAGI is adjusted gross income (AGI) as figured on their federal income tax return.
MAGI when using Form 1040A. If you file Form 1040A, your MAGI is the AGI on line 22 of that form, figured without taking into account any amount on line 19 (Tuition and fees deduction).
MAGI when using Form 1040. If you file Form 1040, your MAGI is the AGI on line 38 of that form, figured without taking into account any amount on line 34 (Tuition and fees deduction) or line 35 (Domestic production activities deduction), and modified by adding back any:
1. Foreign earned income exclusion,
2. Foreign housing exclusion,
3. Foreign housing deduction,
4. Exclusion of income for bona fide residents of American Samoa, and
5. Exclusion of income from Puerto Rico.
If you find that you do not qualify for this deduction, you can also take the Hope or lifetime learning credit. You can choose which one will give you a better tax break. More on Tuition Fees and Deductions |
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