Are you a college student, or do you have one in your family? If so, you should know about a one-time opportunity to receive double the normal tax credits for education expenses.
Last December, Congress passed a tax bill to provide more relief for the Gulf Coast region that was devastated by Hurricane Katrina. Among the provisions was a special tax break for students attending colleges and universities in the area. They may now be eligible to receive double the normal value of Hope and lifetime learning credits.
Many students abandoned their studies and transferred elsewhere as universities and colleges closed after the hurricane. The double credits are intended to encourage those students to return. But new students moving to colleges in the region are also eligible for the benefit.
Under this program, the 2005 Hope tax credit will be $3,000 and the 2006 credit rises to $3,300. The lifetime learning credit will be a maximum of $4,000 for both 2005 and 2006.
To qualify for the Hope credit you must be in your first two years of higher education. The lifetime learning credit is for courses taken to acquire or improve job skills or as part of a degree program.
The extra credits are available only for 2005 and 2006. Various other limitations apply, but if you’re interested please contact us. We can provide more details and help determine whether you might benefit from this tax break.
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