School Expense deductions and credits
- September 30, 2014
- David Greene
- Comments Off on School Expense deductions and credits
There are some credits and deductions related to children in school, even up to college level, that can be utilized to reduce your taxes. Student loan interest is deductible as well as tuition and fees for the higher education of an eligible student. Credits are dollar for dollar reductions in your tax. The Lifetime Learning Credit can be worth up to $2,000 and the American Opportunity Credit can be worth up to $2,500. These only apply to higher education though. Also, the earnings in 529 Plans are not federally taxable as long as the money is applied to college expenses. An Educational Savings Account is tax deferred and can be used for educational expenses from elementary school on up.