David Merrill was back again with even more advice on understanding taxes. Today, he talked about education credits and what you can do to see a larger refund this season.
- American Opportunity Credit – Must be within first 4 years of higher education to qualify. Maximum credit of $2,500 per qualifying student. Must be enrolled at least half time for at least one academic period out of the year. Phases out if MAGI is over $80,000 but less than $90,000 for single filers and over $160,000 but less than $180,000 for MFJ taxpayers. You cannot claim the credit if your modified adjusted gross income is over $90,000 for single filers and $180,000 for married filing joint filers.
- Lifetime Learning Credit – Credit up to $2,000. Do not need to enrolled at least half-time (could’ve just taken 1 class). $65,000 income limitation for Single filers and $130,000 income limitation for Married Joint filers.
- Tuition and Fees Deduction – Up to $4,000 deduction (not credit). $80,000 income limit for Single filers and $160,000 limit for Married Joint filers.
- Student Loan Interest Deduction – Up to a $2,500 deduction. $80,000 income limit for Single filers and $160,000 limit for Married Joint filers.
To learn more, visit their website or call 717-243-3278.