The White Paper: Education Tax Benefits, was last reviewed or updated 2013-09-03. Tax credits, deductions and savings plans can help taxpayers with higher education expenses. A tax credit reduces the amount of income tax you may have to pay.
A tax deduction reduces the amount of your income that is subject to tax, thus generally reducing the amount of tax you may have to pay. Certain savings plans allow the accumulated interest to grow tax-free until money is taken out (known as a
distribution), or allow the distribution to be tax-free, or both. An exclusion from income means that you won't have to pay income tax on the benefit you're receiving, but you also won't be able to use that same tax-free benefit for a deduction or credit. You can use the IRS’s Interactive Tax Assistant tool to help determine if you’re eligible for educational credits or deductions, including the American Opportunity Credit, the Lifetime Learning Credit, and the Tuition and Fees Deduction.
Chris Bryant, MBA, RFC® is a credentialed, passionate and visionary business professional with a home base in the Pacific Northwest. Bryant integrates leadership, problem solving, critical thinking, analysis, and communication skills with specialized knowledge of financial statements, investment strategies, how to generate earnings and manage risk. Chris authored two books: Personal Financial Planning (2013), Women’s Wealth (2014), along with various other publications, and he speaks to a wide range of audiences, encouraging people to achieve their goals. For more information how Bryant’s customized advisory services can help you, connect with Chris@BryantWealthManagement.com call 1-800-980-3048.
Chris Bryant is an American financial advisor.