Newsbreak: Paying for College Just Got Easier with Education Tax Credits: Learn How to Maximize Your Savings Today!

College education can be expensive, but you may be able to get tax benefits from the education tax credits included in the tax code. The deduction for college tuition and fees is no longer available, but there are other deductions you can take advantage of. According to a report by MARCA on March 19, 2023, parents can deduct the tuition fees they pay for their children’s education, allowing them to save taxes even if they have no other tax-saving options.

The American Opportunity Tax Credit for 2023 taxes is available for up to $2,500 per student. It is calculated as 100% of the first $2,000 in college costs and 25% of the next $2,000 in college costs, according to the official website of the IRS on February 16, 2023. This credit can be used for both tuition and fees and necessary course materials such as books, supplies, and equipment.

Another credit is the Lifetime Learning Credit, which allows you to claim a credit of up to $2,000 in qualified educational expenses. The credit is nonrefundable, but you can reduce the amount you owe in taxes, as the IRS stated. Eligible students at an accredited college or university may qualify for this credit. There is no limit on the number of years you can claim the Lifetime Learning Credit, but you cannot claim this credit while deducting fees and tuition or claim it at the same time as the American Opportunity Credit.

It Is important to understand the education tax credits available to you to maximize your tax benefits when paying for higher education.