When talking about financing your education, several popular terms such as the Expected Family Contribution or the Cost of Attendance will pop up. In this article, I am going to increase your awareness of another very interesting term: educational tax breaks. Most students and parents do not really notice this, but there are vast amount of tax breaks being offered for students and parents paying for education costs. Other than focusing on grants and financial aids, you can also look into some of the available tax breaks to get some of the money you spent on education back in your pocket.
You can easily enjoy tax breaks in the form of a tax deduction or tax credit when you are paying for education costs. Although most of these are designed for parents, you as a student can also get similar benefits as long as you are paying your share of your education costs as well. In fact, with the right knowledge on available tax breaks, you can easily save thousands of dollars for paying college tuition. You can also get similar benefits if you participate in funding your state's Section 529 account.
To help you get started right away, look into two of the best tax break programs available: the Hope Scholarship and the Lifetime Learning Credit. Any of these programs can easily give you $ 1,500 – $ 4,000 tax benefits in an instant. The Hope Scholarship provides up to $ 1,650 as a tax credit for your first two years of college. You can double the amount – to $ 3,300 in total – if you are part of the Gulf Opportunity Zone students. The Lifetime Learning Credit, on the other hand, provides up to $ 4,000 in tax credits if you enroll for any type of post-secondary education, including classes or courses taken to improve or acquire job skills.
If you have not claim the available tax benefits, start now and enjoy a lot of fantastic educational tax breaks. The small effort of filing the claim will be well worth it since you can potentially save thousands of dollars in no time at all.