Some people who lost their jobs due to the coronavirus health crisis decided to go back to school as a way to reinvent themselves and today they spoke with the certified public accountant. Jose Leon to find out what IRS credits are available to students.
According to the expert, there are two credits: the American Opportunity Tax Credit and the Lifetime Learning Credit, both of which can be applied for with the help of a qualified accountant.
“[Para] You have to talk to your accountant for these credits and explain if you have a technical career, a bachelor’s or a master’s degree, “he commented.
According to him official IRS portal, the American Opportunity Tax Credit (AOTC) is a credit for educational expenses paid by an eligible student during the four years of higher education.
Under this premise, you can get a maximum annual credit of $ 2,500 if you are eligible and, if the credit reduces the amount of taxes you owe to zero, you can be refunded 40% of any remaining amount of the credit (up to $ 1,000).
How do you know if you are eligible for AOTC? These are the points that you must fulfill:
- Looking for a degree or other recognized educational credential.
- Be enrolled at least part-time for at least one academic period (semesters, trimesters or any other period of study) beginning in the fiscal year.
- Not have completed the first four years of higher education at the beginning of the fiscal year.
- Not having claimed the AOTC or previous Hope credit for more than four fiscal years.
- Not have a felony drug conviction at the end of the tax year
The portal indicates that in order to claim this credit, the law requires that a taxpayer or an independent has received the Form 1098-T and the Declaration of enrollment from an eligible educational institution, whether national or foreign.
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