Do I qualify for an education credit?

The following answer was provided by Barry Beck, CPA, Barry D Beck, CPA, PFS, DABFA, Bedford.

Q: My wife and I are filing married/jointly. She is attending school at Tufts (since a few years ago). We received gift money from her grandmother, which we used to pay the tuition for last year. Can I still qualify for education credit even though we didn't actually "pay for tuition" ourselves? --Tim, Belmont

A: The gift was made to you. It is now your assets and can be used by you in any way you see fit. Therefore the use of the funds to pay tuition is ok as a deduction for the education credit. Of course you still need to fit all the requirements to claim the credit.

The following answer was provided by James Castro, CPA, Castro Thresher & Oliveira PC, Attleboro.

A: I agree with the prior comment. The key is form over substance here. You must cut the check to the educational institution. If your grandmother pays it directly then you could not take the credit.