Steve--Thanks a million for the info and for writing it so clearly.
When Son #2 has had his two years of Hope Scholar****p and Son #1 is
getting
the LLC, I'll really be missing out in a way because of the LLC limit
being
per family, right? Or, maybe I'll be lucky enough not to incur so much
expense!
"Steve Blank" <steve@[EMAIL PROTECTED]
> wrote in message
news:ez_9i.6996$u56.1590@[EMAIL PROTECTED]
> You have a handle on it, but your dollar info is a bit out of date.
>
> The Hope Scholar****p Credit for 2006 taxes is now 100% of the first
> $1,100 you paid, plus 50% of the next $1,100 for a maximum credit of
> $1,650 (it was adjusted upward in 2006 and might possibly go up again
> for the 2007 tax year).
>
> If your son starts college fall 2007, you can get the full credit on
> both your 2007 and 2008 tax returns. After that he would move into the
> Lifetime Learning Credit which is 20% of the first $10,000 you paid, to
> a maximum of $2,000. Depending on what you actually paid, the Lifetime
> is sometimes better even in the first two years.
>
> The credits are based on Qualified Expenses, which are defined as
> Tuition and Fees. Room and board, books, etc. are not deductible
anywhere.
>
> Student loan interest is separately deductible (not a credit) on the
> 1040 (Line 33 on the 2006 1040, Line 18 on the 1040A).
>
> The Hope Credit is per student, so you would again be able to take it
> for your second son for two years, while still taking the Lifetime
> Learning Credit (which is per family) for your first son.
>
> Two things to know:
>
> 1. The Hope and lifetime Credits have an income phase-out. If parent AGI
> exceeds a certain amount the credit starts reducing, and is gone at a
> maximum amount. That maximum is currently $110,000 for a joint return,
> $55,000 for a single parent. If income exceeds these limits, there is an
> Education Expense Deduction (not a credit) of up to $4,000 per family
> that may be taken instead, so long as income does not exceed $160K
> joint/130K single). You cannot take more than one of these different tax
> breaks for each student, but may be able to take more than one when
> there are multiple students.
>
> 2. There has been new legislation recently introduced in Congress that,
> if passed as submitted, would totally replace these education tax breaks
> with a new single program for 2008. Depending on the final rules, if
> passed, it may increase the tax break, allow it to include expenses for
> room and board etc., and depending on an individual family's situation
> be better than the current ones (or not)
>
> Steven B. Blank
> College Financial Aid Consultants
> 29 Ives Hill Court
> Che****re, CT 06410
> (203)250-7761
>
>
> TheBreeze said the following on 6/7/2007 4:00 PM:
> > I think I've got the Hope Scholar****p figured out--I can take 100% of
the
> > first $1000 of tuition I pay for my son, and 50% of the second $1000
of
> > tuition. I can take this credit on my taxes for the first two years
he's
in
> > college (full time student, etc.). It just dawned on me, though, that
the
> > tax year doesn't align with the school year. So, I'd be able to get
the
full
> > $1500 credit this year for just his fall semester, then the same next
year
> > for the spring and fall semesters that fall in the 2008 tax year. Is
that
> > true?
> >
> > So, after that, I've used up the two years max I can take the Hope
> > Scholar****p credit for him, and then start taking the LLC? Or is there
> > something else?
> >
> > Also, are the tuition and room/board deductible on our taxes? How
about
> > interest on unsubsidized loans (where the interest is payable starting
on
> > day #1 rather than after graduation)? Are there other deductible
expenses
> > for parents paying some of the tuition, room/board, books, etc.?
> >
> > Is there any influence when son #2 goes to college in son #1's senior
year?
> >
> > Thanks for your input.
> >
> >
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