By A.J. KING

ajk012@latech.edu

 

Taxes are a certainty in American life, but for students there is hope.

Hope and Lifetime Learning credits are two tax benefits that may reduce the amount of taxes students and their families pay for college tuition.

Don McGehee, a certified public accountant of Ruston, said a tax credit reduces the amount of taxes to be paid, but if there are no taxes to be paid, the credit neither hinders nor helps.

“For students and parents in most cases, the Hope Credit gives you dollar for dollar tax reduction for your tuition,” McGehee said.

He said students are eligible to claim the credits for the cost of tuition toward a degree or for additional study that leads to proficiency in a chosen occupation.

“I see a lot of clients who qualify, but may not know they qualify,” he said. 

McGehee pointed out that the tax credits do have limitations and are not available to all students.

“They are direct tax credits and a financial benefit, but are strictly for tuition,” he said.

Despite the limitations, McGehee said people should search for information about the tax credits in case they are eligible.

“Many of my clients are ignorant [about the credits] even though the information is out there,” McGehee said.

He said his clients are not taking advantage of the credits.

McGehee also said many parents do not know student loans count in the Hope Credit because the parents are liable for the debt even if the student will pay back the loans after college.

“Eventually, it all comes out of the family pocket,” McGehee said.

He said the Hope and Lifetime Learning credits do not cover room and board or books.

McGehee also said he thought most students and their families should know about the credits because schools notify them that the credit is available.

Roger Vick, director of financial aid, said students have access to knowledge about the tax credits through the financial aid Web site.

“They can overlook it, but I think if they have to fill out taxes and are advised by a tax completion service, they should know,” Vick said.

Joanna Cook, a freshman basic and career studies major, said neither she nor her parents had ever heard about the tax credits.

“Most students are supported by parents and leave [taxes] to them,” she said.

Cook said she and her parents were never presented with information about the tax credits.

“I’ll definitely look into it.  Anything to save money,” Cook said.

For more information visit the IRS Web site www.irs.gov to find IRS Publication 970 which contains details about the Hope and Lifetime Learning credits.