Stop Procrastinating On Your Taxes

Sam Donaldson

Sam Donaldson teaches courses on tax law and property in the Georgia State College of Law. Outside of Georgia State, much of his free time is dedicated to both solving and creating crossword puzzles. His puzzles have been published by The New York Times, USA Today, the Los Angeles Times and Sky magazine.

Five questions with a GSU tax expert

I only work part-time when I’m in school. Do I even need to file taxes?

Like much in life, it depends. If you had federal income taxes withheld from your wages in 2012, you should file an income tax return. But don’t worry, most likely it means you’ll get a refund of some of the taxes withheld. You also need to file a tax return if you were self-employed and earned more than $400 in 2012. There are other situations where it’s necessary to file, but those are the most common for GSU students.

Well, there goes my weekend. What common mistakes should I look out for if I’m filing my taxes in a rush?

Be sure to double-check the numbers! Your social security number needs to be correct. If you get that wrong, you’ll make things much harder on yourself. Make sure your math is right, too. You don’t want a refund held up because of a math error.

Are there any education tax credits available for students?

Yes. The American Opportunity Tax Credit gives you a credit of up to $2,500 for the cost of tuition, fees and course materials paid in 2012 that cover the Spring 2012, Summer 2012, or Fall 2012 semesters. You can even count amounts paid for the Spring 2013 semester if they were paid in 2012. If the credit exceeds your tax liability, up to $1,000 is refundable. In other words, this is a credit that can add to your refund! The Form 1098-T you received from GSU will be helpful in computing this credit.

How do I claim this credit?

You claim the American Opportunity Tax Credit by completing a Form 8863 and attaching it to your tax return. You can easily find the form online through the IRS’s website.

What’s the craziest tax story/cautionary tale you’ve heard?

I always like the story of the former Treasury employee who decided to write a book about two guys who tour Nevada visiting brothels. In the name of “research,” this guy visited various brothels himself and then tried to deduct the amounts paid to prostitutes as business expenses. The United States Tax Court held that his costs were more for his personal benefit than for his “business” of writing a book. I wouldn’t call it a cautionary tale (unless you’re thinking of claiming similar deductions), but it’s a fun story.

 

5 Responses to Stop Procrastinating On Your Taxes

  1. Obviously, education tax credits available for students could be used only in case of further plans set up for the next semester. Due to the babelized nature of college life, I doubt that such an opportunity is reliable now.
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