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Federal Tuition and Fees Deduction on Form 8917 allowed on NYS Tax Return as a deduction?

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Level 2

Will NYS accept the Tax Extender provision for the Tuition and Fees Deduction Form 8917 as an Adustment to NYS taxable income?  This used to flow from Federal to NYS and then NYS allowed the Tuition Credit as well.  Has this been eliminated in Tax Year 2019?  I cannot find an answer to this question anywhere on the NYS Tax Department web site.  Thank you for your help.

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Level 15

NY tax code conforms to the IRC on a rolling basis, except for provisions that are decoupled and IRC §222 is not among those.

NY also has its own provisions for tuition credit/deduction.  However, these sections under NY Consolidated Laws do not cross reference IRC §222 for any adjustments and are, therefore, administered without regard to the IRC.

This means there shouldn't be an adjustment for the deduction on IT-201.  Are you seeing anything different on the return?

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Still an AllStar
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Level 2

Before 2018, there was an adjustment on the Form IT-201 for the Tuition and Fees deduction, but not in 2019.  I just wanted to know if NYS was going to revert back to before this Deduction was disallowed by the IRS. If I can decipher what you are saying, the answer is NO.  Am I correct?

 

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Level 15

The answer is no. But where did you find the adjustment on the 2018 return?

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Still an AllStar
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Level 2

It's on the 2017 IT-201 Return: LINE 18 - NYS allowed the flow through of the Federal Deduction for Tuition & Fees and they allowed you to take the Tuition Credit as well.  It was a "Double dipping" but they did allow it!  Look at your software line 18 for 2017, it takes you to a form that lists all the allowable subtractions from Federal Taxable Income and on the "Income Adjustments Statement" Line 12 is listed "Tuition and Fees Deduction"

In 2018, The IRS disallowed the Tuition and Fees deduction in the cuts.  But as you know, it was re-instated in Dec 2020 as one of the Tax extenders.  So that is why I am asking, if NYS is going to once again allow that flow through of the Federal Adjustment to Taxable Income as they always did in 2017 and previous years.

I was at a Tax Seminar once and the NYS presenter from the NYS Tax Department said it out loud: "this is an area where NYS allows the double dipping"

 

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Level 2

Sorry I meant "Reinstated in December 2019" for tax years 2018 and 2019

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Level 15

Like I said, there's no adjustments to be made for the reasons stated and citations were given for what you were explained at the seminar.

You won't have the IRC reversing the deduction at the federal level for what's being allowed in NY in this instance.

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Still an AllStar
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