March 2002, Volume 34, Number 3
Tax credit available for college courses
Anyone who paid the cost of any graduate or undergraduate course during 2001 may be eligible for a federal tax credit on the 1040 form.
Library staff taking community college, university or graduate library science courses may be able to improve their tax status with one or both of these federal credits.
The Lifetime Learning Credit (LLC) is a credit of up to $1,000 for qualified tuition and related expenses that were paid for courses offered by an eligible educational institution.
The LLC is not based on the class load, and both graduate and undergraduate courses are eligible. Generally, anyone applying can receive 20 percent credit of the amount paid for the course and expenses, with some reduction based upon modified adjusted gross income.
A second program, the Hope Credit is also a tax credit but has several restrictions.
This tax credit is for anyone taking the first two years of undergraduate studies, and who is enrolled at least half-time.
The credit is 100 percent of the first $1,000 qualified tuition and expenses plus 50 percent of the next $1,000.
Librarians may want to look at this credit if they have a child in college and are not already taking advantage of this savings. The computation is also easy when the documentation from the college or university is available.
More information is available in IRS Publication 970 “Tax Benefits for Higher Education” online at
The form is 8863 “Education Credits (Hope and Lifetime Learning Credits) at
Contact a tax advisor or the IRS with any questions.
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