If you paid for higher education in 2018 you may see some tax savings when you file your tax return. You might be eligible for educational tax credits if you, your spouse, or dependent took any post high-school educational courses.
There are two credits available for those who paid for higher education:
These both may reduce the amount of income tax owed, and you will use Form 8863, Education Credits, to claim the above credits.
The American opportunity credit is:
Worth a maximum benefit up to $2,500 per eligible student
Only for the first four years at an eligible college or vocational school
For students pursuing a degree or other recognized education credential
Partially refundable. This means if the credit brings the amount of tax owed to zero, 40 percent of any remaining amount of the credit, up to $1,000, is refundable.
The lifetime learning credit is:
Worth a maximum benefit up to $2,000 per tax return, per year, no matter how many students qualify
Available for all years of postsecondary education and for courses to acquire or improve job skills
Available for an unlimited number of tax years
To be eligible to claim the American opportunity credit, or the lifetime learning credit, the law requires for you to receive Form 1098-T from the educational institution.
Please remember that LR Tax & Accounting Services, Inc. is always here to help with any questions and concerns. We offer tax planning, tax resolution, tax returns for individuals and business, accounting, payroll and bookkeeping. Please contact us today to get a quote or ask a question!
If you had experience with us, please leave a feedback for you on Yelp,