|
|
Income
Tax Credits and Deductions
As a result of legislation passed in Congress and signed by the President in 2006, Taft University students may now be entitled to special income tax benefits. No unaccredited college or university can provide these special benefits to its students.
The University filed an application with the Department of Education on the effective date of the new law and was approved late in 2006. The law requires that an institution be accredited by an accrediting body recognized by the Department of Education such as DETC and meet certain other requirements before it can be approved.
The approval means that students may qualify for a Lifetime Learning Credit beginning in 2007 on their federal income tax return equal to 20% of their qualified education expenses. As an example, if a student paid $5,500 in tuition, this could reduce the student’s tax liability (or increase their tax refund) by as much as $1,100 per year for each year of their enrollment. For most taxpayers, they can claim the full credit if their adjusted gross income on a joint return is less than $96,000 ($48,000 if they file a single return).
Some education expenses may also qualify as a business deduction for work-related education pursuant to Section 162 of the Internal Revenue Code.
It is recommended that applicants consult with their tax advisor or read IRS Publication 970 (Tax Benefits for Education) to determine how these credits or deductions might benefit them individually.
There is no charge for the preparation of the IRS Form 1098-T which is necessary to claim the tax credits or deductions.
|
