How Do Education Tax Credits Work? – The Buy Me Blog

The STO tax credit and other tax credits that are for education. If your child’s income is dependent on the tax system, you can be able to pay for their tuition, as high as $2,500, in your tax returns, however it is necessary to follow the regulations.

One of the tax credits that is easiest to apply for would be The American Opportunity Tax Credit. It is the American Opportunity Credit is a credit for qualified educational expenses to be paid by you and your spouse as well as an dependent child, for up to 4 years of university education. The AOTC is a tax credit in the undergraduate portion of schooling that covers tuition alone, and not rooms and boards. In almost every college, the tuition cost is likely to exceed that of the maximum $2,500 amount for AOTC.

One of the tricky parts of one of the most difficult aspects about American Opportunity Tax Credit is that it’s only offered for four years. During that time, your child will attend school for five tax seasons since the school year doesn’t precisely coincide with your tax year. The AOTC is not available for your final spring semester. Get a little money off taxes by using this credit.