Tax Education Expenses

p Running head : Tax education expenses : Tax advantages , deductions and credits available to parents

Student name

Course code , Semester , Year

Tutor

February 24 , 2009

Education expenses account for more than a quarter most families earnings per year . This often poses great financial difficulty to most parents (Linda Nataraj , 1985 . Luckily in the United States , there are tax advantages , deductions and credits available to students and parents . These benefit the parents by reducing their expenses on education and hence give them room to invest in other areas . This is

also so because the government knows the importance of formal education Tax credits are considered to be more valuable because unlike tax deductions which are recovered by reducing the amount of income to be taxed , tax credits reduce the amount of tax payable directly

Hope credit provides up to a maximum of 1 ,800 tax credit per student per year . Student in the Midwestern disaster areas get a maximum of 3600 . It is available in the first and second years in college Students qualifying for this must have enrolled for at least half the time . The amount is claimable in the tax returns as long as one had paid fees for the current tax year . Married parents filing returns jointly and earning less than 96 ,000 and single taxpayers earning 48 ,000 gross salary will qualify for full credit . Those earning more than 116 ,000 and 58 ,000 for single parents will not qualify . Those in between these figures qualify for partial credit...