Teach Yourself About Education Credits
The new American Opportunity credit modifies the existing Hope Credit for tax years 2009 and 2010, making the Hope Credit available to a broader range of taxpayers, including many with higher incomes and those who owe no tax. It also adds required course materials to the list of qualifying expenses and allows the credit to be claimed for four post-secondary education years instead of two. Many of those eligible will qualify for the maximum annual credit of $2,500 per student.The full credit is available to individuals whose modified adjusted gross income is $80,000 or less, or $160,000 or less for married couples filing a joint return. The credit is phased out for taxpayers with incomes above these levels. These income limits are higher than under the existing Hope and Lifetime Learning Credits.
If you would like to learn more about this new rule, or would like to discuss how these items may affect your tax situation, please call our office to schedule an appointment.
Grab Education-Expense Deductions
You cannot claim the tuition and fees tax deduction in the same year that you claim the American opportunity tax credit or the lifetime learning credit. You must choose among them. You also cannot claim the tuition and fees tax deduction if anyone else claims the American opportunity tax credit or the lifetime learning credit for you in the same year. A tax deduction of up to $4,000 can be claimed for qualified tuition and fees paid. Though the credit will usually result in greater tax savings, taxpayers should calculate the effect of both on the tax return to see which is most beneficial — the tax credit or the deduction.
If you would like to learn more about this new rule, or would like to discuss how these items may affect your tax situation, please call our office to schedule an appointment.
When will I get my stimulus check?
Stimulus checks are being distributed by social security number, visit the following website
Visit http://www.irs.gov
New mileage rates for 2009
The standard mileage rate increases effective January 1, 2009 to 55 cents per mile.
Visit http://www.irs.gov
