Our TurboTax Tax Trends Report revealed Gen Z changed employers at a higher rate in tax year 2021 and young single filers were more likely to see an increase in their income in both 2020 and 2021. In addition, student athletes are extremely busy practicing, traveling, studying, attending games, and making money using their name, image, and likeness. They have not had time to keep up with new tax laws and what the new streams of income using their name, image, and likeness mean to them. These are just a few trends that can impact Gen Z taxes and why TurboTax is making a concerted effort to help. Even if you’re claimed as a dependent, it’s often still worth filing a tax return..
i am a full time college student and made under $4k, is there a free version
If scholarship money or a fellowship grant is used for non-qualified expenses – such as room and board – the funds might not be tax-free. In that case, they don’t have to be subtracted from the qualified education expenses used to calculate the education tax credits. This could result in a larger education credit and an overall lower tax bill. Education tax credits like the American Opportunity Credit and Lifetime Learning Credit can significantly reduce the amount you owe in taxes. If you attend a college or trade school, you may be eligible to claim an education tax credit.
If you have not paid for the online edition you are using, have not filed your tax return or registered the Free edition, then you can clear your return and start over with a lower priced edition. Click on Tax Tools on the left side of the program screen while working on the 2023 online tax return. All features, services, support, prices, offers, terms and conditions are subject to change without notice.
However, if taxable scholarships or grants need to be reported, an upgrade may be necessary to include additional tax forms like the 1098-T Tuition Statement. If you’re a freshman, getting adjusted to your new life may feel overwhelming. But with new beginnings come new opportunities, like getting smart about your finances now to build up your wealth in the future. If your tax situation involves freelance work, rental properties or investment income, you’ll likely need to upgrade to a paid version, such as TurboTax Premier or TurboTax Premium.
TurboTax features that help maximize your tax refund
For students looking to save money, TurboTax offers a user-friendly experience to simplify tax filing. By understanding their tax needs in advance, college students can determine whether they qualify for free filing and avoid unexpected costs. One factor determining eligibility for free TurboTax is whether a student is claimed as a dependent on someone else’s tax return. Many college students under 24 are still claimed as dependents by their parents, which can affect available tax credits and deductions. TurboTax is especially well-suited for people filing simple tax returns — think W-2 income, student loan interest and a few common tax credits.
While its free version works well for basic needs, paying for a higher tier can be worth it for the added support if your return is a bit more complicated. However, tax situations become more complex when students have freelance income, receive 1099 forms, or claim specific tax credits. If additional forms are required beyond an essential return, TurboTax may prompt an upgrade to a paid version.
How do I file for free as a college student?
Get unlimited advice, an expert final review, and your maximum refund, guaranteed with TurboTax Live Assisted Basic. On average, it now costs well over $30,000 for a year of tuition, fees, books, supplies, and living expenses at a four-year college. Trade school is also expensive – averaging around $15,000 per year. Either way, covering higher education costs is a challenge for many people.
You also have to subtract any tax-free educational assistance (such as certain scholarships, grants, or employer-provided assistance) from your total qualified educational expenses. However, in most cases, the credit is only available for undergraduate school. That’s because you can’t claim the credit if the student has completed the first four years of post-secondary education. Plus, you can only claim the credit for a maximum of four years per student. Carla Ayers joined Kiplinger in 2024 as the E-Commerce & Personal Finance Editor. She earned a master’s degree in Integrated Marketing Communications from Eastern Michigan University.
While most scholarships are tax-free for tuition and educational expenses, portions used for room and board may be considered taxable income. If a student is filing as a dependent, they can still use free TurboTax, but they won’t be able to claim personal tax credits like the Education Tax Credit. If they are filing independently and supporting themselves financially, they may qualify for credits such as the American Opportunity Tax Credit (AOTC) or Lifetime Learning Credit (LLC). The free version is designed for simple tax returns and may not cover more complex situations like itemized deductions or certain types of income.
While TurboTax simplifies the tax filing process, there are a few considerations to keep in mind. Before filing with TurboTax, it’s important to know that not all versions are free. While this tool can boost refunds, it may occasionally encourage upgrades that aren’t necessary for every tax situation. You can use the app to snap a pic of your W-2 and other documents and your information will be automatically entered in your return.
TurboTax Online: Important Details about Filing Simple Form 1040 Returns
- For married couples filing a joint return, the credit is gradually reduced if your modified adjusted gross income (MAGI) is $160,000 or more.
- The free version is designed for simple tax returns and may not cover more complex situations like itemized deductions or certain types of income.
- You cannot be supporting yourself on parental support, 529 plans or student loans & grants.
- Here’s what college students need to know about using TurboTax to file taxes without added expenses.
- The IRS is currently planning for a threshold of $5,000 for tax year 2024 (the taxes you file in 2025) as part of the phase in to implement the lower over $600 threshold enacted under the American Rescue Plan.
Whether you file your taxes yourself or have a TurboTax expert do it for you, we’ve got you covered. Even if you aren’t required to file, doing so could put money back in your pocket. That’s because you might get a refund or qualify for deductions and tax credits for college students, which can reduce your tax liability. With the cost of education on the rise, you’ll be glad to know that education credits and deductions may help offset some of that cost. There’s a new urban myth among college students that says they can get a $1000 from the government just for filing a tax form.
Also note that you might not be able to claim the American Opportunity Tax Credit in the future if you claim the credit when you’re not eligible for it. You’ll be banned for two years if it’s determined that your ineligible claim was made with reckless or intentional disregard of the law. The ban will last for 10 years if your ineligible claim was due to fraud.
Ten Money Saving Tips for College Students
- It’s worth up to $2,000 per tax return and may be available if your MAGI is $80,000 or less ($160,000 if you are married filing jointly).
- There are no limits on the number of years you can claim the credit, and you can claim the credit for just one or two classes (so there’s no half-time student requirement).
- You can’t be a dependent on someone else’s tax return or married filing separately.
- Most students can file Federal and State taxes for free until March 15th with the Free Edition.
- As a college student, you may still qualify for a tax deduction of up to $4k, even if you get grants, loans, or a scholarship.
It’s important to note that the mobile app doesn’t have access to the print center or tax tools. With tax laws changing regularly, TurboTax remains valuable thanks to its in-depth guidance, educational resources and hands-on help throughout the filing process. A closer look at TurboTax’s pros and cons to help you decide if it’s the right tax filing software for this tax season. Like all of the credits and deductions listed, eligibility differs for people with higher incomes.
While these features offer peace of mind, it’s important to note that audit support is limited to guidance rather than full representation. This can save time and reduce errors, especially for users with multiple income sources — though not all financial institutions are supported. Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more – straight to your e-mail.
If you do wait, you can still file with TurboTax up until the last hour on April 15th. When you’re in the zone between a child and a full-blown adult, it’s good to have some guidance about taxes. Take a look at theses 5 tax tips for students to make sure you’ve got your bases covered. But one area that you may think is a little confusing and a little intimidating is filing your taxes, however it doesn’t have to be with tax software.
Up to $10,000 of 529 plan funds can also be used to pay for tuition for private, public, or religious elementary, middle, turbotax for college students or high schools. You’ll need to sign in or create an account to connect with an expert. The refundable portion of the American Opportunity Tax Credit (if any) from Form 8863 is reported directly on your 1040 form. On the other hand, your earning potential can increase significantly as your level of education increases. But paying for it can still be difficult, so any type and amount of financial assistance is helpful.
There’s a few key things to know about how the ending of the student loan payment freeze can affect your taxes; plus, learn about some education tax credits many people aren’t aware of. There is a growing need for NIL tax education across the country as more and more student-athletes are taking on brand deals and partnerships, profiting off of their Name, Image, and Likeness. During the event, students were engaged and excited to learn about the specific tax implications that come along with being an NIL athlete who participates in brand deals. What’s more, the new tax credit is available to more taxpayers than the Hope Credit. The full credit may be claimed by people with modified adjusted gross income (MAGI) of up to $80,000 for single taxpayers and $160,000 for married taxpayers filing jointly. Lower-income taxpayers also benefit because up to 40% of the credit (or $1,000) is refundable, meaning that you can expect a check from the government if you owe no taxes.
