Update March 17, 2013 – On March 12, 2013 the IRS released a statement about the problems with some Education credit claims. In the statement they say they are working hard on sorting out the problem, but it may take up to 4-6 weeks to complete. In the mean time there is not much that affected taxpayers can do, other than wait for their refund to be released once the IRS has completed sorting out the problem.
Update February 9, 2013 – Educations credits claimed on Form 8863 can be filed from February 14, 2013.
If you are a student at Arizona State University (ASU) claiming education credits you might find that your 2012 tax refund will be delayed.
As I reported in my recent article the IRS has announced that 2012 Tax Returns claiming eduction credits on Form 8863, cannot be filed until mid February. This will mean that if you e-file your tax return you will not see the refund until late February or early March at the earliest.
For a lot of ASU students the credit they will be looking to claim is the American Opportunity Tax Credit. This is a credit for undergraduates in the first fours years of their post secondary education. Provided they satisfy the qualifying conditions the credit can be worth up to $2,500 with up to $1,000 repayable to the student even if they have no tax liability. It is the refundable part which makes the American Opportunity Credit so beneficial. Note, that in certain circumstances only the student’s parents can claim the credit.
For my clients I am recommending that they still book their tax preparation appointment as soon as they have all their information ready including the 1098-T from ASU. I can then check which education tax benefit is the best for them. Depending on which benefit is best I can either file their return at the start of the tax season on January 30, 2013 or the return will be ready to go once the IRS gives the all clear to file returns with Form 8863.
If you are an ASU student and would like assistance with preparing your 2012 tax return and claiming the American Opportunity Tax Credit, you can book an appointment by calling me on (480) 363-4808. For most students my fixed fee for preparing the return is $95. This includes the Federal Return, one resident State Return and e-filing of the returns. I also save you time and hassle by coming to you to prepare the return.
Disclaimer – This article does not constitute personal tax advice to the reader and is only offering general information. You should seek professional advice for your own situation as the most appropriate tax planning depends on your personal and unique circumstances.
Posted By Mark Smith
Mark Smith, EA is an Enrolled Agent and accountant with over 30 years tax and accounting experience. He is the owner of Cranmere Accounting and Tax Services LLC. He can be contacted on (480) 363-4808 or by email at firstname.lastname@example.org if you need assistance with any of the above.