Tax Benefits for Education
Posted on | February 24, 2010 | 7 Comments
Tax Benefits for Education
The IRS has a number of different tax credits that you can take to help pay for college tuition and expenses. The first is the Tuition and Fees deduction. This deduction reduces your taxable income up to $4,000 and is usually taken when a family does not qualify for the other tax credits available.
The American Opportunity Credit, this credit will pay for a student during the first four years of college. The credit was developed last year and expanded the Hope Credit. $1,000 or the $2,500 tax credit is refundable. Therefore, you can receive a refund when you did not owe taxes during the year.
The Lifetime Learning Credit is available to older students including job training classes, undergraduate, and post-graduate coursework. The credit is for $2,000. There is an enhancement of an additional $2,000 if you reside in a Midwest disaster area. One of the fun changes to the tax code congress has given us.
The Hope Credit is for only the first two years of college is phased out after 2008 except for a Midwestern disaster area. Those attending college in this designated area can take up to $3,600 in tax credits to help pay for tuition and fees.
529 College Savings Plans have been expanded to include computer equipment and Internet access. Non of the credits can be claimed at the same time for the same student. And students cannot claim the credits if they are dependents of their parents for the year.
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Tags: 529 plan > american opportunity credit > Credit > hope credit > lifetime learning credit > phone directory search > tax > Tax Benefits for Education
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7 Responses to “Tax Benefits for Education”
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March 24th, 2010 @ 9:47 am
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March 24th, 2010 @ 9:57 am
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March 24th, 2010 @ 11:02 am
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March 24th, 2010 @ 1:12 pm
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March 24th, 2010 @ 10:06 pm
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April 14th, 2010 @ 6:13 pm
Great to see some tax incentives as I’m considering going to school.
February 2nd, 2011 @ 10:32 pm
[...] doing your taxes there are so many things to remember that mostly everyone forgets about tax benefits for parents. You could receive benefits for your kids. Here are some ways to see if you [...]