The cost of attending college and catholic schools has risen dramatically over the past few years. For the school year 2019-2020, the average tuition fees for enrolling at a private college university was around $37,000, while the figure is about $10,500 for a public university. With such a steep price tag, you’ll need all the help you can get to make it more acceptable and affordable.
The federal government established tuition tax credits to help people deal with the high cost of education by effectively reducing the overall expenses involved. However, it can be overwhelming if you don’t know the various tax credits applicable and how to claim them.
As you probably already know, tax credits help lessen the total amount of taxes you need to pay on a dollar-for-dollar basis. Education tax credits can offset and counterbalance the steep price of attending college by lowering the amount owed on your income tax return.
Furthermore, you may become eligible for a tax refund if the credit brings your tax amount to less than zero. You can use this cash refund for school supplies and textbooks.
Watch this informative video by The Bemused: Making Sense of Money, where you’ll discover the best way of calculating tuition tax credits. Most college students and their parents get confused when filling up the IRS Form 1098-T. So this video can help you better deal with the calculations involved in child tax credits.