The Department of Education has also been awarded with government grants aimed at debt relief and so the agency is offering some programs that can benefit students and parents in terms of a tax credit. The program is called Hope Credit, and it is given to students and their parents so that they can cope with post-secondary education. This is basically a non-refundable credit program.
The credit that you can get will depend on your income and the tax amount. The credit is applicable to two years to shoulder the tuition fees and other expenses but the student should already be enrolled half time. You must ensure that requirements are complied accordingly to qualify.
Among the requirements include paying education expenses for higher education of an eligible student. The student can be the parent, spouse, or dependents for whom you’re claiming the tax return exemption. You will need Form 8863 for the education credits.
You must be reminded that you can’t take both the Hope Credit and the deduction of the expenses or tuition fees of one student within a year. Others usually claim for the deduction on the tuition fees rather than the Hope. Another program is the Lifetime Learning Credit.
In the said program, qualified applicants can claim $2,000 to $4,000 on education expenses but the amount will depend on the area or location. Disaster areas usually get higher claims. You have to choose between the Hope and the Lifetime Learning because you can’t claim for both programs. The latter is most suitable for graduate students or for those who are currently pursuing a degree.
Education is very important to every person. This is your key to future success and that of your dependents. If you are having problems with the education expenses, inquire about these programs, their requirements, and other related info.
If you’re eligible to get the Hope Credit, you can also qualify for the Lifetime Learning Credit. However, you must choose only one. With the aid in education expenses, you will no longer resort to borrowing and so your debt problems will be lessened through the government grants aimed at debt relief.