The Catholic University of America

Summary of Federal Laws

Tax

Tax Issues Related to Students

Tax Credits and Tax Deductions

26 U.S.C. §25A

26 CFR 1.25a-3; (Hope Scholarship) 26 CFR 1.25A-4 (Lifetime Learning Credit); 26 CFR § 1.25A-0 (Table of Contents)

The HOPE Scholarship Credit is one of two income tax credits for qualified tuition and related expenses added by the Taxpayer Relief Act of 1997. The HOPE Scholarship Credit may be elected for qualified education expenses incurred during the first two years of a taxpayer's, spouse's, or dependent's post-secondary education. Certain income limits apply. The amount of the credit is determined by using Form 8863, Education Credits. The form takes into account the amount of qualified tuition and related expenses paid per eligible student, and the amount of the taxpayer's Modified Adjusted Gross Income. The Hope Credit cannot be claimed by someone who is listed as a dependent on another person's tax return.

The Lifetime Learning Credit is a tax credit available for qualified tuition and related expenses incurred at any time.. The IRS web page on the Lifetime Learning Credit spells out the conditions and expenses that do and do not qualify. The credit is family based rather than based on number of students in the family.

For those who do not qualify for one of the above, there is tuition and fees deduction that might be available. See Form 8917.

 

Resources

Instructions for Form 8863 Education Credits 

Tax Benefits for Higher Education (IRS Publication 970)

Form 8917 Tuition and Fees Deduction

 

 

 

updated 8-24-18 mlo