Questions & Answers

when you have temporary, sort term employment away from home, yes, the costs of lodging etc are deductible but if this is a permanent position, no you are merely keeping up two households

There are sites that the IRS lists as free for Federal forms on the IRS website. You will need to pay extra to those sites if you also want to file the state forms. However, many states allow you to file free on their own sites. I haven't paid for filing either Federal or State forms for years because I live in California. If your income (total for everyone on your filing) is less than $49,000, you can get your Federal and State forms prepared and efiled by a real live person for free. It's called VITA and sponsored by the government. Volunteer Income Tax Assistance Program The VITA Program offers free tax help to low- to moderate-income (generally, $49,000 and below) people who cannot prepare their own tax returns. Certified volunteers sponsored by various organizations receive training to help prepare basic tax returns in communities across the country. VITA sites are generally located at community and neighborhood centers, libraries, schools, shopping malls, and other convenient locations. Most locations also offer free electronic filing. To locate the nearest VITA site, call 1-800-829-1040.

No you are not "independent" for tax purposes. Even though your parents aren't claiming you, the fact that they legally can makes you unable to "claim" yourself on a tax return. You can still file a return but you will need to check the box that says "yes" next to the question, "Can you be claimed as a dependent on someone else's return?"

Generally, no. If the distribution is less than the basis, then the basis is reduced by the amount of the distribution and no tax is paid. However, after enough distributions, the basis will eventually reach zero and cannot be reduced further. If the total amount of all distributions of this type that your receive from any particular share of the mutual fund exceeds the amount that you paid for the share, then you do pay tax on the rest. For example, if you purchase shares for $100 and they pay $10 per year in these distributions, then the payments for the first 10 years just reduce the basis, but after the tenth year's payments reduce the basis to $0, the payments for the future years (starting with year 11 in this example) are taxed.