Deduction for Higher Education

We all know that college is expensive, but did you know that you can deduct certain higher education fees from your taxes? Find out what expenses are qualified deductions so you can better plan for tax season 2017.

When can I take this deduction?

You can deduct qualifying expenses paid in the tax year for:

• Education during in the year, or
• Education that begins during the year, or
• Education that begins during the first three months of the following year.

Which expenses qualify?

Qualifying expenses include what you pay in tuition and mandatory enrollment fees to attend any accredited public or private institution above the high school level.

You cannot take a deduction for:

• Room and board, optional fees (such as for student health insurance), transportation, or other similar personal expenses.
• Course-related books and supplies, unless you are required to buy them directly from the school.
• Any course involving sports, games or hobbies, unless it’s part of the degree program.

What if I receive grants or scholarships?

You have to subtract any scholarships, educational assistance, or other nontaxable income spent for educational purposes (other than gifts or inheritances). For example, if your employer offers a tuition reimbursement plan as a fringe benefit that pays $1,000 of the cost of a $1,500 course, only the remaining $500 would count for purposes of this deduction.

Who qualifies?

Qualified expenses you pay for yourself, your spouse or your dependents are eligible for the deduction.

Exceptions:

• If you can be claimed as a dependent on your parents’ or someone else’s tax return, you cannot claim the higher education deduction.
• If you are married and choose the married filing separately tax status, you cannot take this deduction.

How much can I deduct?

The deduction is $0, $2,000 or $4,000 depending on your Modified Adjusted Gross Income (MAGI).

• $4,000 deduction for MAGI of $65,000 or less ($130,000 or less for joint returns).
• $2,000 deduction for MAGI between $65,001 and $80,000 (between $130,001 and $160,000 for joint returns).
• $0 if your MAGI exceeds these limits.

No double-dipping

You can’t deduct or take a credit for the same expense twice.

If you deduct these expenses under some other provision of the tax code, such as for employee or business expenses, you cannot also deduct the expenses for the Tuition and Fees Deduction.

Also, you can’t deduct expenses paid with tax-favored money including:

• Tax-free interest from savings bonds
• Tax-free earnings from qualified state tuition program (Section 529 Plans)
• Tax-free earnings from Coverdell Education Savings Account

The Tuition and Fees Deduction cannot be combined with the American Opportunity or Lifetime Learning credits for any single student in a single tax year.

 

 

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Save Money On School Supplies

School supplies are expensive, and the prices seem to go up every year. Don’t invest your dollars into the back-to-school black hole. Instead, invest your time and energy into these money-saving tips.

How to Save on Back to School Supplies

1. Do a Closet and Supply Sweep

Believe it or not, you might already have plenty of school supplies lying around your house. Closets, desk drawers, and basement bins might hold hidden treasures that can save you money.

Start by rounding up all of the office and school supplies you already own. Put them in a central location, like a plastic bin or on the dining room table, so you can make a list of what you have. Keep this list in your purse, or in the car, so you don’t forget it when you shop for school supplies.

What do your children need for the school year?

• Pens, pencils, markers, and highlighting pens
• Erasers
• Rulers
• Notebooks and loose-leaf paper
• Scratch paper
• Binders
• Calculators
• Crayons
• Art supplies
• Post-it notes

In addition, go through your kids’ closets and start sorting. Clothing that the kids have outgrown, and worn clothing, should be donated or tossed. Once you complete this “supply sweep,” you’ll have a clearer picture of what youactually need to buy. Ideally, the sweep will prevent you from buying something you already have on-hand.

2. Shop at Garage Sales and Thrift Stores

Garage sales can be a treasure trove of deals for back to school supplies. Backpacks, gently used shoes, clothing, and even school supplies can be picked up for a song.

Start hitting up garage sales for everything you need. It takes time, but you can score some incredible bargains this way. You can also ask friends and family members to keep an eye out for you, while they shop at garage sales.

You can also find awesome bargains at thrift stores. Clothing is dirt cheap, and many stores run sales specifically for parents shopping for back to school items. Start early, though. The selection will be picked over by the first day of school.

3. Set Limits

As your kids grow older, they will insist on having the “latest and greatest.” They may request Justin Bieber binders and backpacks, and name-brand clothing from the mall. Although your kids crave these items, these “character-focused” products will quickly destroy your back to school budget. In addition, these items often aren’t made to last; many trendy clothing items are very cheaply made.

So, set limits with your kids, and speak with them about money-based values. Let your children know that companies should be paying them for advertising their products by wearing name-brand clothing. Show them the difference between a cheaply made trendy item of clothing, and a well-made item without a logo, and explain the difference in quality.

If you start teaching your kids about money management at a young age, they will grow up to understand and espouse these values. Let kids have two “specialty” items, like a Justin Bieber lunchbox and binder. Once they’ve chosen their two items, the rest of their supplies must be purchased at bargain prices.

Tip: Don’t forget to scour sites like eBay and Craigslist for high-end and specialty items.

4. Save on College Supplies

If you have a child heading to college, then you will experience some serious sticker shock. From picking up supplies for their dorm room, to investing in college textbooks, sending a kid to college isn’t for the faint of heart. There are many ways to save money on back to school shopping for your college student.

First, learn how to save money on college textbooks. Buy used textbooks on sites like Amazon, eBay, and Half.com. You can also compare prices on new books on CheapestTextbooks.com, or buy books on bargain sites like Textbookx.com. Additionally, you can save 50% or more on textbooks if you buy a digital copy and download it to your Kindle, or other e-reader. View textbooks available for digital download at CourseSmart.com or Cafescribe.com. And at the end of the semester, find websites where you can sell used textbooks for cash.

Shop for dorm room essentials like rugs, sheets, and light cooking equipment at garage sales and thrift stores. You can save a lot of money by buying used items. You can also ask friends and family members if they have any items they do not use; your social and family networks will be glad to help! You can get gently used items for free, while givers declutter their homes. Everyone wins!

10 more money saving tips can be found on the original article by CLICKING HERE

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Back-to-School Tips for Parents

Starting a new school year is exciting, but it can also be scary. Help your youngster ease back into the routine with little things like meeting the new teacher or having a tour of the school.

Meet the new teacher.
For kids, one of the biggest back-to-school fears is “Will I like my new teacher?” Breaking the ice early on is one of the best ways to calm everyone’s fears. Take advantage of your school’s open house or back-to-school night. Some teachers welcome phone calls or e-mails — another great opportunity to get to know each other before the year begins.

If personal contact with the teacher isn’t possible, try locating the teacher’s picture on a school website or in a yearbook, so your child can put a name with a face. If your child’s teacher sends a welcome letter, be sure to read the letter together.

Tour the school.
If your school hosts an open house, be sure to go. Familiarizing your child with her environment will help her avoid a nervous stomach on the first day. Together you can meet her teacher, find her desk, or explore the playground.

With an older child, you might ask him to give you a tour of the school. This will help refresh his memory and yours.

Connect with friends.
A familiar friend can make all the difference when heading back to school. You might try calling parents from last year’s class and finding out which children are in your child’s class this year. Refresh these relationships before school starts by scheduling a play date or a school carpool.

Tool up.
Obtain the class supply list and take a special shopping trip with your child. Having the right tools will help him feel prepared. While keeping basic needs in mind, allow for a couple of splurges like a cool notebook or a favorite-colored pen. These simple pleasures make going back to school a lot more fun.

School supply lists also provide great insight into the schoolwork ahead. Get your child excited about upcoming projects by explaining how new supplies might be used. Let him practice using supplies that he’s not used before — such as colored pencils or a protractor — so he will be comfortable using them in class.

Avoid last-minute drilling.
When it’s almost time to stop playing, give a five-minute warning. Giving clear messages to your child is very important.

Chat about today’s events and tomorrow’s plans.
While it is important to support learning throughout the summer, don’t spend the last weeks of summer vacation reviewing last year’s curriculum. All kids need some down time before the rigors of school begin. For some kids, last-minute drills can heighten anxiety, reminding them of what they’ve forgotten instead of what they remember.

Ease into the routine.
Switching from a summer to a school schedule can be stressful to everyone in the household. Avoid first-day-of-school mayhem by practicing your routine a few days in advance. Set the alarm clock, go through your morning rituals, and get in the car or to the bus stop on time. Routines help children feel comfortable, and establishing a solid school routine will make the first day of school go much smoother.

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10 Ways To Cut The Cost Of Going Back To College

Applying for grants and financial aid for school can be daunting but necessary. But did you know that there are other ways to save when going back to college? Learn how to cut costs with these tips.

1. Look for free or discounted tuition based on your age. As a Huffington Post article on older students just noted, a growing number of colleges have juicy tuition deals for students 60 or older.

California’s 23 state universities offer free tuition in their Over 60 Program, for example, and all of Texas’ public colleges and universities have tuition reduction programs for students 55 or older. Check with your state’s department of education to see if there are similar deals near you.

2. Sign up for a free or nearly-free MOOC. That’s the acronym for the popular Massively Open Online Courses, like Coursera, Udacity, EdX and Lynda. Often offered by top-tier universities, like Stanford and Princeton, MOOCs offer cheap ways to learn from their instructors anytime, anywhere.

3. Check with your employer. Under federal law, employers can offer tax-free education assistance of up to $5,250 in 2013. You might not even need to be studying something directly related to your job to take advantage of this benefit.

But you may need to earn a minimum grade or get your manager’s approval for the curriculum to be eligible for this workplace perk, says Mitchell D. Weiss, adjunct professor of finance at the University of Hartford and co-founder of its Center for Personal Financial Responsibility.

Some employers also require you to stay with them for a certain length of time after taking the course or repay the tuition if you leave.

4. Explore community colleges. Their courses usually cost just a few hundred dollars per credit. Especially worth checking out: the American Association of Community Colleges’ Plus 50 Initiative at 18 schools across the country, whose curriculum is designed to help students 50 and older train for new jobs.

Tips 5 – 10: Continue Reading the Original article by CLICKING HERE

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