tax breaks for students

Have you ever heard of the hope tax credit, or the lifetime learning credit? I hadn't (or at least didn't remember) until recently. My husband is going back to school to get an education degree, and we have suddenly been adjusting to living on my salary (mostly). Anyway, this little bit of information is going to get us $400-$1650 back on our taxes. It isn't a deductible...it is CREDIT!

The hope tax credit is for students who are paying for their own education, and have not had more than two years of college. If you spent more than $2000 on your education, then you can qualify for a $1650 credit. After two years you can no longer apply for this tax break, however.

The lifetime learning credit applies forever though, and you can get 20% back on what you spend on tution in a year up to $10,000. So, if you spent $4000, for example you could qualify to get about a $800 tax break.

There are limitations in regards to income, and a few other things, but it looks like we will be able to apply for at least one of these. I am not quite sure if we are beyond the two year cut off or not (we are right on the line) but hopefully we can apply for the Hope this year, and the Lifetime Learning for the rest of the years.

Anyway, if you fall into the right categories, you should check this out!