Saturday, October 29, 2011
The tax code offers numerous breaks for education, from the American Opportunity Tax Credit and the Lifetime Learning Credit to 529 college-saving plans and the business deduction for work-related education. While none is a one-stop solution to the problem of paying for education—and many are mutually exclusive—they can make it easier to foot the bill. ...
Unfortunately, navigating the tax code is no easy task. It takes IRS Publication 970, Tax Benefits for Education, 84 pages to explain 12 different benefits.
"The tax benefits for education are so complicated, many people either don't know they exist or just throw up their arms in despair," says Gary Carpenter, a long-time CPA who heads the National College Advocacy Group, a nonprofit based in Syracuse, N.Y. "They make the alternative minimum tax look easy."