Use the Lifetime Learning Tax Credit to your advantage.

With many students going to and  returning to classes, I wanted to remind you that you want to claim your Lifetime Learning Credit come tax season.

What is the Lifetime Learning Credit?

The Lifetime Learning Credit can be used for qualified tuition and other related expenses up to $2,000 a year. Note: You cannot claim both Lifetime Learning Credit and Hope Credit for the same person.

If you make $48,000 or more ( $96,000 if you file joint), you will start to phase out with benefits. If you make more than $58,000 (or $116,00 if you’re married), you can not claim the tax credit.The is no limit to how many years you can claim the tax credit.

What’s the Difference Between the Lifetime Learning Credit and the Hope Scholarship Credit?

One benefit of the Lifetime Learning Credit is you aren’t require to be at least a half time student in the first two years of college. so even if you’re taking one course a semester, you can qualify for the credit (provided you meet the other requirements).

You can also use the tax credit for classes to improve your job skills. The Hope Credit requires that you work towards a degree to claim it on your taxes.

What’s Best Option for Me Tax Wise?

I’m not a financial planner and I don’t know your personal circumstances. For more information on the Lifetime Learning Credit and other tax benefits for college students, check out the IRS’ website.

The IRS has information to help you determine which tax credit is best for you and your family. Did you know that there is a  tuition and fees deduction for your education expenses? The IRS has information on that as well. Choose the option that will give you the lower tax.

Photo Credit: stopnlook

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