What if I were to tell you there was a program where the IRS would literally pay you up to $8000 in cash to go back to school?
And, if transportation or travel is a problem, don’t worry!
Because you can still qualify and get the cash even if you want to go to school part-time and online from the comfort of your home!
The program I am talking about not only exists, but is being underutilized by most everyone in the U.S. who wants to continue their education.
So please, after reading this section, tell every hard-working American taxpayer you know about this opportunity!
So here’s what it’s all about…
The American Opportunity Credit
The American Opportunity Credit is a tax credit designed to help pay for the first 4 years of college.
It means that if you are paying money to a college, you could have that money, up to certain limits, come straight off what you owe for taxes.
Here are the details, from the IRS2:
- Tuition, related fees, books and other required course materials generally qualify. In the past, books usually were not eligible for education-related credits and deductions.
- The credit is equal to 100 percent of the first $2,000 spent and 25 percent of the next $2,000. That means the full $2,500 credit may be available to a taxpayer who pays $4,000 or more in qualified expenses for an eligible student.
- The full credit is available for taxpayers whose modified adjusted gross income (MAGI) is $80,000 or less (for married couples filing a joint return, the limit is $160,000 or less). The credit is phased out for taxpayers with incomes above these levels. These income limits are higher than under the existing Hope and lifetime learning credits.
- Forty percent of the American opportunity credit is refundable. This means that even people who owe no tax can get an annual payment of the credit of up to $1,000 for each eligible student. Existing education-related credits and deductions do not provide a benefit to people who owe no tax. The refundable portion of the credit is not available to any student whose investment income is taxed at the parent’s rate, commonly referred to as the kiddy tax.
An important thing to note about this credit is that only 40% is refundable.
This means that if you are already getting a tax refund each year, and you want to take advantage of this credit—and really reap the rewards—then you will need to lower the amount being withheld from your paychecks for the years in which you intend to claim the credit.
Again, from the IRS:
“Eligible parents and students can get the benefit of this credit during the year by having less tax taken out of their paychecks. They can do this by filling out a new Form W-4, claiming additional withholding allowances, and giving it to their employer. For details, use the withholding calculator on IRS.gov”
This tax credit can provide up to $2,500 per student per year the first 4 years of college.
$2,000 per year of that is a dollar-for-dollar credit… meaning that every dollar you spend on education is one dollar in credit.
Essentially, the government is giving you $8,000 for college… for your child.
And one of the great things about this tax credit is that you can get it when you are taking classes online.
One of our staff used it just last year to cover $2,500 of his costs for online classes. It’s as if the tuition was free, after the tax credit.
The American Opportunity Credit is a great way to get the government to pay for you (or your child’s) education.
You can learn MORE here:
https://www.irs.gov/uac/American-Opportunity-Tax-Credit
NOTE: This report was excerpted from the “Real Cash Secrets” manual.