Hope education tax credit question

[cicy33]

has anyone used this? I started school this year. I am a full time student. Does this mean I qualify? I started recently.

[jIM_Ohio]

You do qualify if you are enrolled at a qualified school and meet other IRS requirements.

You could get $1650 back with hope (100 percent of first 1100 an 50 percent of next 1100).

If you have 8k+ of tuition, look at lifetime learning credit (20 percent of 10k max; 2k back) for a higher refund.

[moneybags]

There is also the tuition & fees deduction. This usually works out for those that earn too much to qualify for the education credits. It is a reduction in income, not a credit.

[cicy33]

If I am using student loans, do I still qualify?

[jIM_Ohio]

Originally Posted by cicy33

If I am using student loans, do I still qualify?

YES as long as the student loans are used for the tuition owed.

[cicy33]

Okay, one more dumb question. I enrolled this fall. lets say for argument sake my school qualifies. I am sure it does but... I have applied for the student loans but they have not been dispersed yet. (my school is pending my tuition waiting for the loans) What if they don't come through until 2009. Does this mean that I can't claim it? or do I get to claim it for 2008 because I started in 2008? Thanks for any answers. I really appreciate them.

[jIM_Ohio]

the year the expenses were incurred will be good for the IRS

[moneybags]

Originally Posted by jIM_Ohio

the year the expenses were incurred will be good for the IRS

If you look at the instructions on Form 8863, Education Credits, you can take the amount paid, not billed. Individual income tax is always calculated on a cash basis. For example, if I get a property tax bill in November for 2008, but I pay it in January 2009, it would go on my 2009 tax return. Same for education expenses.

[jIM_Ohio]

The loan was applied for in 2008- that will be the amount used to pay the expenses.

We covered this in tax class- it is sometimes tough to have the loans clear in first semester, but it is acceptable to take the credit for that tax year.