For many young people, the first time they need to file their own taxes are while they are in college. Although college student income is typically low, there are a few variables common to this group that can make tax preparation a bit challenging.
1. Know Your Dependent Status
If you are under the age of 24 and in college, there is a good chance that your parents or legal guardians are still claiming you as a dependent. If you are older than 24 and no longer live at home or receive the bulk of your financial support from your guardians, then you are independent for tax filing purposes. There is one exception for those over the age of 19 that weren't in school the previous year — if you supported yourself during the gap year and won't be receiving support when you return to college, you may be able to claim yourself as an independent for tax purposes.
2. Collect All of Your Income Statements
Many students have income from a variety of sources — paid internships, part-time jobs, and independent contract work are the most common — but you may also receive tax forms from your bank for interest earned on savings accounts or investments. Internships and regular employment, such as through the school or an outside employer, will provide you with the tax forms you need. Typically this is a W2 form, which shows all the income you earned as well as the taxes and other fees you paid in already. If you work as an independent contractor, such as in food delivery or performing tasks, you may be provided with a form 1099.
3. Request Tax Documents From Your School
Many students receive scholarships, which in some cases may be counted as income. You may also have a work-study job as part of a financial aid package. Some parts of tuition may also be used for tax credits. Your school should provide you with 1098-T detailing all of this information, so make sure you have it before filing your taxes. You may also need forms from your student loans, particularly if you have been paying on them already.
4. Consider If You Have Credits
There are a few credits available to students, so you must check to see if you are eligible. For example, many first-time college students qualify for the American Opportunity Tax Credit. Your tax preparer can tell you if you are eligible for this or any other credits.
Contact a tax preparation service if you need more help.