Educational Tax Benefits
- The American Opportunity Credit
This credit can help parents and students pay part of the cost of the first four years of college. The American Recovery and Reinvestment Act modifies the existing Hope Credit for tax years 2009 and 2010, making it eligible for a broader range of taxpayers. Eligible taxpayers may qualify for the maximum annual credit of $2,500 per student.. General 40% 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 Hope Tax Credit
The credit can help students and parents pay part of the cost of the first two years of college.
- The Lifetime Learning Credit
This credit can help pay for undergraduate, graduate, and professional degree courses to improve job skills-regardless of the number of years in the program. Eligible taxpayers may qualify for up to $2,000.
- Enhanced benefits for 529 college savings plans
Certain computer technology purchases are now added to the list of college expenses that can be paid for by a qualified tuition program, commonly referred to as a 529 plan.
- Tuition and fees deduction
Students and their parents may be able to deduct qualified college tuition and related expenses of up to $4,000. The deduction is an adjustment to income, which means the deduction will reduce the amount of your income subject to tax. The Tuition and Fees Deduction may be beneficial to you if you do not qualify for the American Opportunity, Hope, or Lifetime Learning Credits.
For more information, see Publication 970, Tax Benefits for Education which can be obtained online at IRS.gov or by calling the IRS at 800-829-3676.
The documents that are necessary to determine eligibility for educational tax benefits are issued by the Cashiers/Student Accounts Office and are called 1098T Forms. The forms are available online at the secured TouchNet site.