Free Consultation|USA Only +1 (866)754 4460|Outside USA +1 (516)822 3100
InfoTaxSquare.com - Website Logo
  You are here : Home  >   Services  >   Income Tax Filing Across The USA  
TESTIMONIALS
InfoTaxSquare.com - Testimonials  


Two Tax Credits to Help Pay Higher Education Costs

 
0/5 stars (0 vote)
Category : > Income Tax Filing Across The USA
Posted On : Thu Jan 27th,2011

 
Two Tax Credits to Help Pay Higher Education Costs
 

Two Tax Credits to Help Pay Higher Education Costs

There are two federal tax credits available to help you offset the costs of higher education for yourself or your dependents.  These are the American Opportunity Credit and the Lifetime Learning Credit.

To qualify for either credit, you must pay postsecondary tuition and fees for yourself, your spouse or your dependent. The credit may be claimed by the parent or the student, but not by both. If the student was claimed as a dependent, the student cannot file for the credit.

For each student, you can choose to claim only one of the credits in a single tax year. You cannot claim the American Opportunity Credit to pay for part of your daughter's tuition charges and then claim the Lifetime Learning Credit for $2,000 more of her school costs.

However, if you pay college expenses for two or more students in the same year, you can choose to take credits on a per-student, per-year basis. You can claim the American Opportunity Credit for your sophomore daughter and the Lifetime Learning Credit for your senior son.

Here are some key facts the IRS wants you to know about these valuable education credits:

1. The American Opportunity Credit

  • The credit can be up to $2,500 per eligible student.
  • It is available for the first four years of post-secondary education.
  • Forty percent of the credit is refundable, which means that you may be able to receive up to $1,000, even if you owe no taxes.
  • The student must be pursuing an undergraduate degree or other recognized educational credential.
  • The student must be enrolled at least half time for at least one academic period.
  • Qualified expenses include tuition and fees, coursed related books supplies and equipment.
  • The full credit is generally available to eligible taxpayers who make less than $80,000 or $160,000 for married couples filing a joint return.

2. Lifetime Learning Credit

  • The credit can be up to $2,000 per eligible student.
  • It is available for all years of postsecondary education and for courses to acquire or improve job skills.
  • The maximum credited is limited to the amount of tax you must pay on your return.
  • The student does not need to be pursuing a degree or other recognized education credential.
  • Qualified expenses include tuition and fees, course related books, supplies and equipment.
  • The full credit is generally available to eligible taxpayers who make less than $60,000 or $120,000 for married couples filing a joint return.

You cannot claim the tuition and fees tax deduction in the same year that you claim the American Opportunity Tax Credit or the Lifetime Learning Credit. You must choose to either take the credit or the deduction and should consider which is more beneficial for you.

  


Committed to give our users most updated news!
For instant news please subscribe at www.infotaxsquare.com


Leave Your Comments
Your name :
Email Address : Will not be published
Please enter your email if you want us to send answer to your email. We have a strict policy of not to share your email address with any other party.
Your message :
Insert these letters into the textfield below: (required, case-sensitive): BDYMK
Do you want to Subscribe for
InfoTaxSquare Business News Bulletin?
Yes
No
Comments (0)
Load More
No Comments found, Be the first to write comment
 


InfoTaxSquare.com - 10 Successful Years
Copyright © 2010, Infotax Square All Rights Reserved.
InfoTaxSquare.com - Allows Payment Processing With Visa, MasterCard, American Express and Discover
Terms and conditions, features, support, pricing and service options subject to change without notice.