New Tax Credit for Education
The American Opportunity Tax Credit was buried quite deep in the stimulus package…to be honest, I’m just now seeing news of it over the various IRS newswires, but it’s pretty darn cool! It basically extends the HOPE Credit, which has been around for years and offered families with incomes less than $96,000 (or singles less than $48,000), a credit of $1,800 off their taxes for their children’s first two years of education. But, the extension is bigger and better! The income limits are increased to AGI’s of $160,000 for married filing jointly ($80,000 for singles) and the credit is increased to $2,500 and up to four years of education! Forbes has put together a good website with all the details, but I just wanted to make you aware of the potential benefit to your family! If you have a way to do a little tax planning at year end to keep your income under the $80,000/$160,000 income limits, this may be a great year to do so! And, if you know anyone else who may benefit from this information, please forward it along to share!
