I recieved a lot of grants and federal loan for college and my parents file me as their dependent?

Question

When my parents file there tax returns they wuold have to also tell the accountant about the federal loan and grants that i got how would this change the amount of tax return they get back.... my EFC was $1700 out of which my family has already given me $1200 this also includes the registration fee

Answer 1

Federal loan has no effect on your parents taxes. What will affect it would be the grant. What your parents accountant will do will compare the tuition cost to the grant amount. If the tuition cost is more than the grant than you will have education expenses which your parents could potentially deduct (depending on income leve) on their tax return as Hope Credit (first two years of college for you) or Tuition and Fees Deduction, or if you're beyond first two years of college it would be Lifetime Learning Credit instead of Hope Credit.

Answer 2

1

Answer 3

If your parents provide more than half your support they can claim a exemption for you this is the same amount for everyone so how much is only important to see if it is half. If you are living away from your parents, not just away at school they can't claim your room as part of the cost of the house. If you are working you may be providing more than half of your own support so can claim yourself.