As you send your children back to school, you may be wondering what expenses qualify for education credits or tax-free distributions from education accounts. Use the chart below as a guide. If you have any questions, give me a call. Together we can plan how to best pay for your child’s education.

Important Tax Deadlines

  • Aug. 15, 2018 – Extended exempt organizations returns due
  • Sept. 17, 2018 – Third-quarter estimated taxes due
  • Sept. 17, 2018 – Extended partnerships and S corporations returns due
  • Oct. 15, 2018 – Extended individual tax returns due

Tax Notes

The Tax Cuts and Jobs Act raised the Child Tax Credit from $1,000 to $2,000. Of this, up to $1,400 can be a refundable credit. The Internal Revenue Service has not fully explained how this will work, but I’ll let you know as soon as they issue guidance.

Did You Know?

On Aug. 21, 1911, Vincenzo Peruggia stole the Mona Lisa from the Louvre by hiding in a closet overnight. The painting was not recovered until 1913. Peruggia served seven months in jail for the theft.

Expense Coverdell ESA 529 Plan American Opportunity Credit Lifetime Learning Credit
Elementary and Secondary Expenses
Tuition Yes Up to $10,000 No No
Fees Yes Up to $10,000 No No
Room and Board Yes Up to $10,000 No No
Uniforms Yes Up to $10,000 No No
Transportation Yes Up to $10,000 No No
Post-Secondary Expenses
Tuition Yes Yes Yes Yes
Fees Yes Yes Yes Yes
Books Yes Yes Yes Yes
Room and Board If > than half-time If > than half-time No No
Insurance Yes Up to $10,000 No No
Medical Expenses Yes Up to $10,000 No No
Living Expenses Yes Up to $10,000 No No
Transportation Yes Up to $10,000 No No