Replies to: What college costs are tax deductible?
You can take a tax deduction for college tuition and other mandatory school fees. This is called the Tuition and Fees Deduction, and is reported directly on Form 1040. You might be eligible to claim the Hope or Lifetime Learning tax credits for college expenses. Taking the tax credits generally will be more advantageous than claiming the Tuition and Fees Deduction. You cannot claim more than one tax benefit for the same education expenses.
Where to Claim the Tax Deduction
Report the tuition and fees tax deduction on Form 1040 Line 35. This line is normally to report the Domestic production activities deduction. Write a "T" on the dotted line, and enter the amount of your deduction in the box. If you are claiming both the domestic production activities deduction and the tuition deduction, write a "B" on the dotted line, and enter the total of both deductions in the box. Attach a statement that breaks down the amounts claimed for each deduction.
Qualifying Education Expenses
Expenses for tuition, registration fees, and other required fees are
qualifying expenses for the Tuition and Fees Tax Deduction. Do not include the cost of books, supplies, software, room and board, or other miscellaneous expenses for schooling. Qualifying expenses are reported to you and to the IRS using Form 1098-T.
The maximum amount of tuition and fees deduction you can claim is $4,000 per year. If your income is over $65,000 but under $80,000 (unmarried), then the maximum amount you can deduct is $2,000. For married couples filing a joint return, the phaseout range is over $130,000 but under $160,000. For income over these limits, you do not qualify to take the tuition and fees deduction.
From the IRS
"You may be able to deduct qualified education expenses paid during the year for yourself, your spouse, or a dependent. You cannot claim this deduction if your filing status is married filing separately or if another person can claim an exemption for you as a dependent on his or her tax return. The qualified expenses must be for higher education."
Source: IRS Publication 970, Tax Benefits for Education, Chapter 6, Tuition and Fees Deduction.