How To Apply for the Lifetime Learning Credit
In current times, higher education is quite expensive. Parents and student have to counter the high cost of living and education at the same time whereas the ability to earn may not be catching up in a similar fashion. This is a reason for concern for a lot of the students and their parents.
There are, however, ways to reduce such financial burden. There are many schemes from the government that allow deductions in taxable income to help parents whose kids are seeking higher education or anyone wants to become a student.
The limit per household is 20% or tuition fee and other qualified charges up to $10000 dollars. The maximum cap of allowable deduction is $2000. Any amount that is received in financial aid has to be deducted before ascertaining the final amount to be put forth for deductions.
The process of getting a lifetime learning credit is quite simple and anyone who falls in its bracket can easily make use of this facility.
Instructions
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1
Check If You Qualify
The first thing to check is whether your school qualifies for the program as most colleges are but its best to check. Make sure that you or your dependent who is the student is at least studying as a half time student. You must also not be availing Hope Education Credit in that year to apply for Lifetime Learning Credit. Lastly, your income on tax return needs to be under $57,000 for a single person filling and under $114,000 if you are filing a joint return. The amount of allowable deduction starts reducing from $47,000 and in case of a joint tax return from $94,000.
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2
Calculate Amount
Now that you know that you qualify, calculate the amount you are qualified for. This will be 20% of the total tuition fee and other qualifying expenses. Your supplies for college can qualify if the educational institute makes their purchase mandatory through school’s own program.
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3
Apply
Fill out form 8863. You will need to fill in part 2 and 3 of the above mentioned form and submit it to the relevant office.
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