Monday, March 2, 2009
Write Off Textbooks
posted by Shu Zheng
(College Finance 101) Approximately $300 billion of Obama’s $789 billion stimulus bill will consist of tax cuts, and a large portion of that $300B will benefit college students. Enjoy writing off your textbooks, among other things!
Education Credit - HOPE now called “The American Opportunity Tax Credit“
The HOPE scholarship credit has changed a bit. Instead of being able to take the credit for the first two years of college, you can now take the credit for your first four years of college. Instead of being able to take a credit of $1,800, you will be able to take a credit of $2,500, and this amount includes course materials (instead of just qualified tuition expenses). You can now write off your textbooks, dollar for dollar. The bill renames the HOPE credit the “American Opportunity Tax Credit”, and Obama made 40% of it refundable.
A refundable credit means you will get money back even if you don’t owe any tax.
Non-Refundable credit: You owe $500 and get a credit of $600, you now owe zero dollars.
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