CHAPTER 33Educational Tax Benefits
The tax law provides several tax benefits for people attending school. If you can take advantage of them, you are in effect receiving a government subsidy that lowers the cost of education.
Qualified tuition programs (529 plans), which are designed primarily to cover higher education costs, can also be used to pay tuition up to $10,000 for elementary and secondary school, student loans up to $10,000 for the beneficiary and each sibling, and expenses related to apprenticeship programs.
The American opportunity tax credit, the lifetime learning credit, the student loan interest deduction, and Coverdell ESAs can also provide substantial tax savings. However, these tax benefit provisions are hedged with restrictions, such as income-based limitations, that may bar or limit their availability.
The prior-law tuition and fees deduction has been repealed for years after 2020.
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