Students seeking postsecondary education can be subjected to thousands of expenses annually. The Internal Revenue Service, IRS, offers a hope tax credit for those who are at least a part-time student. The credit taxes an amount of money away from what they are liable to pay taxes on.
Who Can Claim the Expense?
The taxpayer, the taxpayer’s spouse, or the taxpayer’s dependent can all be the one in school, and the taxpayer can claim the hope credit. However, the credit only applies to the first $1,800 per student.
Do I Qualify?
There are several requirements to the hope credit tax. You must be enrolled in a post-secondary education program, be enrolled in a program that ends with a degree or some other educational credential, take at least half the normal full-time workload, and cannot have a felony conviction for possessing or distributing a controlled substance.These rules apply to most student tax credits.
What is the Limit?
Just like anything else, the hope credit is subjected to limitations. You must qualify for the entire year, which means if you get a felony during the year, you will lose all credit from the beginning of the year. Taxpayers are not allowed to apply for both the hope credit and the lifetime learning credit. They may also not apply for a tuition and fees deduction. Only the first two years of the post-secondary education is applicable. There are also income guidelines that are subjected to change annually.
The hope credit offers those in post-secondary education a little help with taxes. Talking to a tax preparer will make sure that you file correctly and get all the credit you are due.