TurboTax Edition

TurboTax Free Federal Edition

Who is TurboTax Free Federal Edition Good For?

* If you have a simple return
* If you do not need much guidance when filing your taxes
* If you are single
* If you have no children
* If you need to file a 1040EZ

This product cannot import 1099s ors W-2s. To get this ability, you’ll need to upgrade to TurboTax Basic. If you want additional guidance for maximizing deductions, you’ll need to upgrade to TurboTax Deluxe.

Free Tax Filing sites listed at IRS website

he United States Internal Revenue Service lists about twenty sites that offer free E-Filing. Some also include free tax preparation. Each site has it’s own qualifications, but most allow a maximum income of $54,000 and also have age range restrictions.

An easy way to find the ones you qualify for is to use the “Guide me to a Company” button. You fill out a form with your age, income, etc. and you get a list of the free tax filing sites that you qualify for.

If you get a message about not having session cookies enabled, but you know they are enabled, hit the back button to come back to this page and click the link above again.

Some states also have free e-filing. To find out about them you should visit the website of your state tax bureau.

Eduction Credit or Lifetime Learning Credit – what should I claim?

Eduction Credit or Lifetime Learning Credit. What should I claim?

The answer to this question is “It depends on the amount of your school tuition paid”

Basically, Education credit is simply $2,000 if your income is less then $65,000 and $4,000 if your income is more then $65,000 and less then $130,000.

Lifetime Learning Credit is calculated as 20% (in the vast majority of cases) of your tuition paid.

So, if your tuition paid was more then $10,000 – then you will be better off claiming Lifetime Learning Credit (form 8863) if it is less then $10,000 then it Education Credit should be your choice (form 8917)

How does a taxpayer claim the Lifetime Learning Credit?

The first year that the credit will be available is 1998. Taxpayers will not be able to claim the credit until they file their 1998 returns in 1999. Instructions accompanying the 1998 tax forms (for returns required to be filed in 1999) will explain how to calculate the credit and how to claim it on the tax return.

What is the maximum Lifetime Learning Credit a taxpayer may claim?

The credit is equal to 20 percent of the taxpayer’s out-of-pocket expenses for qualified tuition and related expenses of all eligible family members, up to a maximum of $5,000 in expenses annually through 2002. Thus, the maximum Lifetime Learning Credit a taxpayer may claim through 2002 is $1,000. After 2002, the credit is equal to 20 percent of the taxpayer’s out-of-pocket expenses up to a maximum of $10,000 in expenses. Thus, the maximum Lifetime Learning Credit a taxpayer may claim after 2002 is $2,000. The maximum credit does not change even if the taxpayer is claiming a credit for the expenses of more than one student in the family.

May an individual claim a Lifetime Learning Credit for more than one family member?

Yes. However, unlike the Hope Scholarship Credit, the Lifetime Learning Credit is calculated on a per family, rather than a per student, basis. Therefore, the maximum available credit does not vary with the number of students in the family. For example, if in 1999 a married individual whose modified adjusted gross income is $35,000 pays $5,000 of qualified tuition and related expenses to attend an eligible educational institution, the individual may claim a $1,000 Lifetime Learning Credit. If in the same year the individual also pays another $2,000 in qualified tuition and related expenses for his spouse to attend an eligible educational institution, the individual’s Lifetime Learning Credit is still $1,000.

Is the Lifetime Learning Credit available for a student taking only one course?

Yes. For example, a student who has just graduated from high school and is taking a single course at a community college may claim the Lifetime Learning Credit if the student comes within the income limits and is not claimed as a dependent by someone else.

What are the eligibility requirements for the institution?

They are the same requirements that apply for the Hope Scholarship Credit.

May an individual claim a Lifetime Learning Credit for paying qualified tuition and related expenses for other family members?

Yes. An individual may claim the credit for his/her own qualified tuition and related expenses and the qualified tuition and related expenses of his/her spouse and other eligible dependents (including children) for whom the dependency exemption is allowed. Generally, a parent may claim the dependency exemption for his/her unmarried child if: (1) the parent supplies more than half the child’s support for the taxable year, and (2) the child is under age 19 or is a full-time student under age 24.

Who may claim the Lifetime Learning Credit?

An individual paying qualified tuition and related expenses at a postsecondary educational institution may claim the credit, provided the institution is an eligible educational institution. Unlike the Hope Scholarship Credit, students are not required to be enrolled at least half-time in one of the first two years of postsecondary education. Nonresident aliens generally are not eligible to claim the Lifetime Learning Credit.