USA Funds Provides Updated Information About Higher-Education Tax Benefits
 USA Funds® offers updated information about federal income-tax benefits for taxpayers who incurred higher-education expenses during the past year. USA Funds provides an overview of the deductions and credits available to those taxpayers on its Web site and in a publication, “Higher Education Tax Benefits — Expanded Taxpayer Savings,” which taxpayers may download and postsecondary institutions may order for their students.
Among the changes in these income-tax benefits for the 2006 tax year are the following:
- Prior to its adjournment last December, Congress reinstated a deduction of up to $4,000 for tuition, fees and other qualified higher-education expenses. Due to the late Congressional action, taxpayers will have to follow special instructions to file for the deduction on their 2006 federal income-tax returns.
- The maximum amount of the Hope Tax Credit has increased to $1,650 per student from the previous amount of $1,500 per student.
- Income limits to qualify for Hope and Lifetime Learning Tax Credits have increased. Taxpayers now may qualify for these credits if their modified adjusted gross incomes are $55,000, instead of the previous $53,000, for single taxpayers, and $110,000, instead of the previous $107,000, for married taxpayers filing jointly.
For details about whether they qualify for these tax benefits, taxpayers should be directed to a qualified tax adviser or to the Internal Revenue Service.
|