Claim tuition fees credit when receiving GI Bill benefits?

[PromisedLife]

What is the name of your state (only U.S. law)? OK

I was wondering if we can claim the tuition and fees credit/deduction when we are receiving GI Bill benefits. The benefits are in my husband's name and for his schooling, but we are filing jointly.

The amount of benefits we received in 2008 was greater than the amount we spent on tuition and fees.

http://www.irs.gov/pub/irs-pdf/p970.pdf Page 8 reads: "Payments you receive for education, training or subsistence under any law administered by the Department of Veteran Affairs are tax free. Do not include these payments as income on your federal tax return. If you qualify for one or more of the education benefits discussed in chapter 2-12, you may have to reduce the amount of education expenses qualifying for a specific benefit by part or all of your VA payments. This applies only to the part of your VA payments that is required to be used for education expenses."

The bolded part is throwing us for a loop, so if anyone has any insights, it would be greatly appreciated. A google search provides us with too many differing answers.

 

[LdiJ]

What is the name of your state (only U.S. law)? OK

I was wondering if we can claim the tuition and fees credit/deduction when we are receiving GI Bill benefits. The benefits are in my husband's name and for his schooling, but we are filing jointly.

The amount of benefits we received in 2008 was greater than the amount we spent on tuition and fees.

http://www.irs.gov/pub/irs-pdf/p970.pdf Page 8 reads: "Payments you receive for education, training or subsistence under any law administered by the Department of Veteran Affairs are tax free. Do not include these payments as income on your federal tax return. If you qualify for one or more of the education benefits discussed in chapter 2-12, you may have to reduce the amount of education expenses qualifying for a specific benefit by part or all of your VA payments. This applies only to the part of your VA payments that is required to be used for education expenses."

The bolded part is throwing us for a loop, so if anyone has any insights, it would be greatly appreciated. A google search provides us with too many differing answers.

You can only deduct or claim credit for tuition and fees that you paid out of pocket or by student loans. Anything that was covered by scholarships, grants or the GI BIll may not be used.