Education Tax Benefits

Few advantages are as sought after by parents for their children as an education that will enable them to grow professionally and enjoy the benefits such an education can help bestow. The federal government supports and encourages their efforts to provide that education through various programs and income tax incentives. This course will examine the programs, credits, deductions and federal income tax treatment of various items that affect saving for and financing an individuals education. In so doing, it will consider:

  • Qualified tuition programs
  • Coverdell education savings accounts
  • The education savings bond program
  • Federal tax credits for education
  • The federal tax treatment of scholarships, fellowships, grants and tuition reductions
  • Deductions available for student loan interest
Learning Objectives

Upon completion of this course, you should be able to:

  • Identify the features and tax benefits of qualified tuition programs available under IRC 529
  • Recognize the limits and tax treatment of contributions to and distributions from a Coverdell education savings account (ESA)
  • Identify the tax treatment of interest earned under qualified U.S. savings bonds used to pay certain education expenses
  • Apply the American opportunity and lifetime learning credit rules
  • Recognize the tax treatment given to scholarships, fellowships and other types of educational assistance
  • Apply the federal income tax rules applicable to student loan interest, student loan cancellations and repayment assistance