Tax Benefits

Tuition and fees tax deduction

You may be able to take a tax deduction for qualified tuition and fees for enrollment or attendance at an eligible postsecondary institution if you fall within the income requirements. For details, visit IRS Publication 970, Tax Benefits for Education.

Student loan interest deduction

You may be able to take a deduction for your student loan interest paid. In order for the loan to qualify, it should have been used to pay qualified higher education expenses for you, your spouse, or a person who was your dependent when you took out the loan. For details, visit the student loan interest deduction section of the IRS Publication 970, Tax Benefits for Education.

Hope Tax Credit

You may be able to take a tax credit for the first two years of study for an eligible student who has paid qualified tuition and related educational expenses. The tax credit can be taken by the person who claims the student as a dependent on his/her tax return or by the student if he/she is not a dependent. The tax credit amount is phased out based on your modified adjusted gross income. For details, visit the Hope Tax Credit section of the IRS Publication 970, Tax Benefits for Education.

Lifetime Learning Tax Credit

You may be able to take a tax credit for the remaining years of your education, which can include graduate school. The tax credit can be taken by the person who claims the student as a dependent on his/her tax return or by the student if he/she is not a dependent. This credit also has the same income phase-outs as the Hope Tax Credit. This credit is family-based rather than based on the number of dependents in your family as with the Hope Tax Credit. For details, visit the Lifetime Learning Credit section of the IRS Publication 970, Tax Benefits for Education.