American Opportunty Tax Credit (formerly Hope Credit)
Lower Columbia College students and families who had tuition and other college-related expenses in 2011 may be eligible to claim the American Opportunity Tax Credit when they prepare their federal income tax returns this year.
Form 1098T was mailed to qualified LCC students in January 2012. Students who have questions can find additional information at View Your 1098T Data or call LCC's American Opportunity Tax Credit phone line at 360.442.2920 to leave a message with any questions. Calls are returned the next business day.
American Opportunity replaces a similar tax credit provision called the Hope credit. The new credit of up $2,500 for tuition and eligible college expenses is higher than under the Hope provision. In addition, tax filers may now claim expenses incurred during the first four years of their postsecondary education rather than only the first two.
The full tax credit, which can be claimed for college expenses incurred during the 2011 tax year, is available to taxpayers whose modified adjusted gross income is $80,000 or less ($160,000 or less for joint filers). A reduced credit amount is available to taxpayers with adjusted gross incomes up to $90,000 ($180,000 for joint filers). If a taxpayer's income level was not high enough during the year to incur federal income tax liability, up to 40 percent of the tax credit can be received as a refund.
Depending on individual circumstances, the American Opportunity Tax Credit may not be the most advantageous tax option for all families with higher education expenses.