tuition and fees deduction extended

Paying for College
1

<p>this is Great news. I don't see it on the IRS website yet, but maybe they will update their site soon</p>

<p><a href="http://www.house.gov/apps/list/press/financialsvcs_dem/essabill.pdf%5B/url%5D"&gt;http://www.house.gov/apps/list/press/financialsvcs_dem/essabill.pdf&lt;/a> (look at page 405)</p>

<p>Tax</a> Provisions in the Bailout Legislation more info here, about 2/3 way down, also changes to Hope and lifetime learning credit</p>

<p>NewsChannel</a> 5.com - Nashville, Tennessee - Rescue Plan Offers Savings for Some Taxpayers, Too</p>

<p>n addition to the financial rescue package that everyone's been talking about, the Emergency Economic Stabilization Act of 2008 -- which was passed by Congress on Oct. 3 and signed by the President that afternoon -- includes several tax breaks that could help you.</p>

<p>Many of the provisions extend tax breaks that had expired at the end of 2007, which we had expected to be approved before year-end. Others provide disaster relief, primarily to Midwesterners, and some relief from the alternative minimum tax.</p>

<p>Here are a few of the key consumer tax changes that are included in the new law:</p>

<p>Help for college bills. The new law extends the tuition and fees deduction through the end of 2009 (it had expired on December 31, 2007). This is a great way to write off college costs if you earn too much to qualify for the Hope and Lifetime Learning credits. You can deduct up to $4,000 if your adjusted gross income is $65,000 or less ($130,000 for joint returns) or $2,000 if your AGI is $80,000 or less ($160,000 for joint returns).</p>

<p>This deduction -- which you can claim even if you claim the standard deduction rather than itemizing - is for expense paid for yourself, your spouse or a dependent. See Can You Count on the Tuition Deduction? for tips about which accounts to tap for the college bills to help maximize your deduction.</p>

2

<p>Thanks. I didn't see the changes to the Hope and Lifetime Learning credits in the article; I'll have to dig further as I was planning to use the Hope credit.</p>

3

<p>Hope</a> Credit Increased for Tax Year 2008 - Tax Form Processing LLC has info about 2008 Hope Credit</p>

<p>a second look at about.com link from above reveals this info about hope and lifetime earning credits. It may just be for Midwestern disaster area</p>

<p>Doubled Hope and Lifetime Learning credits</p>

<p>Expands the education tax credits available for college students in the Midwestern disaster area by increasing the HOPE and Lifetime Learning tax credits, and by expanding the definition of qualified educational expenses. In particular:</p>

<pre><code>* Expenses that qualify for the credit (normally only tuition and required fees) shall include tuition, fees, books, supplies, equipment, fees for special services, room and board.
* The dollar amount for qualified expenses for the HOPE credit is doubled from the first $2,400 of expenses to the first $4,800 in expenses. Hope credit is worth 100% of the first $2,400, and 50% of the next $2,400, for a maximum Hope credit of $3,600. (Note: my calculations differ from the $3,000 maximum stated in the summary from the Senate Finance Committee.)
* The percentage amount for the Lifetime Learning Credit is doubled from 20% to 40% of qualifying expenses. The $10,000 dollar limit for qualifying expenses remains unchanged. The maximum lifetime learning credit would thus be $4,000.
</code></pre>