There is more opportunity for those who might not be eligible for the Student Loan Debt Relief Tax credit.
The American Opportunity Tax Credit is worth up to $2,500 per student and is partially refundable, which means you could receive a portion of the credit back as a tax refund.
To be eligible for the AOTC, the student must:
- Be pursuing a degree or other recognized education credential.
- Be enrolled at least half time for at least one academic period beginning in the tax year.
- Not have finished the first four years of higher education at the beginning of the tax year.
- Not have claimed the AOTC or or the former Hope credit for more than four tax years.
- Not have a felony drug conviction at the end of the tax year.
Another credit for borrowers is the Lifetime Learning credit.
The credit is worth up to $2,000 per tax return and is for tuition and related expenses paid for students enrolled in an eligible educational institution.
To claim the LLC, you must meet all three of the following:
- You, your dependent or a third party pay qualified education expenses for higher education.
- You, your dependent or a third party pay the education expenses for an eligible student enrolled at an eligible educational institution.
- The eligible student is yourself, your spouse or a dependent you listed on your tax return.
Borrowers can also register for the SAVE Repayment Plan, which offers lower monthly payments.
The deadline to apply for the Student Loan Debt Relief Tax credit is Friday, September 15.
