One of the largest credits available for college students is the Hope Credit. This credit applies to your first two years of post-secondary education and is just one of the many credits available. To make sure you are getting all the credits available to you call a certified public accountant in Reno today.
According to the IRS “you can claim the Hope Credit if all three of the following requirements are met: You pay qualified tuition and related expenses for the first two years of post-secondary education. You pay the tuition and related expenses for an eligible student. The eligible student is you, your spouse, or a dependent for whom you claim an exemption on your tax return.”
The eligible expenses for the Hope credit are tuition, activity fees, books, school supplies, etc… The basic way to decide if something qualifies is that it has to be paid to the institution because of enrollment. Thus, books and supplies can be included if they are necessary for a class.
If you are a college student or one of your dependents is a college student, then you need to make sure you think about the Hope Credit when it comes time to file your taxes. You can deduct up to $2,000 for your college expenses.
On top of this, there are some modifications to the credit, which are provided by the American Opportunity Tax Credit. The IRS states that for tax years 2009 and 2010, the American Opportunity Tax Credit modifies the Hope Credit as follows:
1. The maximum amount of the credit is increased to $2,500.00.
2. The credit can now be claimed for the first 4 years, not 2, of postsecondary education.
3. The modified adjusted gross income limitations are increased.
4. Qualified expenses include course materials.
5. Generally, 40% of the Hope Credit is now refundable (up to $1,000).
If you are a college student, or one of your dependents is, then you need to contact a certified public accountant in Reno today and start deducting your college expenses.
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