Misc educational credit?

You've posted this question, and/or several versions of it, on this NG and at least one other (misc.legal.moderated) and gotten quite a few answers already.

I appreciate your desire to get the "right" answer and I'll give you my opinion shortly, but I want to remind you a few things first, these are things that many posters here don't realize:

1 - even though many of us who answer here are professionals, without all the details of your situation you cannot be sure you're getting the right answer BECAUSE we don't have access to all the information; 2 - you can't rely on what we tell you as authoritative, only The Code and Regs do that. So even though we'll tell you what we think, we are not always right (though once I did think I was wrong, but it turned out I was mistaken about that!); 3 - any answer you want to rely on is going to require that you pay for it - I, and many others here, do out best to answer questions as best we can, but you can't really expect us to pony up legal citations and research in detail for free. 4 - in your situation, I'd recommend that you go see a tax pro. YES, you'll have to pay. However, my take about you (from reading the number and context your posts) is that you are likely to ALWAYS second guess whatever you decide. 5 - While I applaud your diligence in trying to get the right answer, keep in mind that I can't teach you in 30 minutes what its taken me 30 years to learn.

Now, my answer -

Your expenses, including your tool fee, which is an expense the school requires of you to allow you in the program, should count toward ONE of the educational credits or the deduction. Which one, who knows - depending on your total situation one may be better for you than the other and without doing your entire return no one here, not even me, can tell you which one to use.

My best guess is that you'll either use the Lifetime Learning Credit OR the Tuition and Fees deduction. I don't imagine you qualify for the HOPE credit since that is for first and second year students and based on your doing graduate level work you couldn't possibly be a first or second year student. I have no idea at all about the American Opportunity Credit and YOUR situation, but I'd guess that you'd likely be better served by one of the other options. My basis for this is based on almost 30 years in this business and my gut instinct about what I've seen.

Go see a tax pro, pay the few dollars and know your return is right, Gene E. Utterback, EA, RFC, ABA