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What is the Tuition and Fees Deduction?

The Tuition and Fees Deduction is no longer allowed beginning in tax year 2018. However, for taxes years prior to 2018, you may be able to  take a deduction for qualified education expenses paid for yourself, your spouse, or your dependent(s) during the academic year. However, if another person can claim an exemption for you as a dependent on his or if you file your taxes using the married filing separate status, you cannot claim this deduction. The qualified expenses must be for higher education.

The amount of your income subject to tax may be reduced  by up to $4,000 using the tuition and fees deduction.

Generally, you can claim the tuition and fees deduction if you meet all three of the following requirements:

  1. The eligible student is yourself, your dependent, or your spouse for whom you claim an exemption on your tax return.
  2. You pay the qualified education expenses of higher education.
  1. You pay the education expenses for an eligible student.

You cannot claim the tuition and fees deduction if any of the following apply:

  1.  Your filing status is married filing separately.
  2. Another person can claim an exemption for you as a dependent on his or her tax return.You cannot take the deduction even if the other person does not actually claim that exemption.
  3. Your modified adjusted gross income (MAGI) exceeds limits set by the IRS.
  4. You (or your spouse) were a nonresident alien for any part of the tax year and the nonresident alien did not elect to be treated as a resident alien for tax purposes. More information on nonresident aliens can be found in Publication 519, U.S. Tax Guide for Aliens.
  5. You or anyone else claims an American Opportunity or Lifetime Learning credit in 2016 with respect to expenses of the student for whom the qualified education expenses were paid.

The tuition and fees deduction is based on qualified education expenses you pay for yourself, your spouse, or a dependent for whom you claim an exemption on your tax return. Generally, the deduction is allowed for qualified education expenses paid in 2016 in connection with enrollment at an institution of higher education during 2016 or for an academic period beginning in 2016 or in the first 3 months of 2017.

For example, if you paid $1,500 in December 2016 for qualified tuition for the spring 2017 semester beginning in January 2017, you may be able to use that $1,500 in figuring your 2016 deduction.