Almost half of all undergraduates in the 2007-2008 school year received an educational tax break, according to a new study from the National Center for Education Statistics.
Low-middle-income families ($36,100-$66,599) and high-middle-income families ($66,600-$104,599) account for primary recipients of the tax breaks. The study determined the most common reason low-income dependent students did not receive a tax benefit was they had no net tuition after subtracting grant aid and veterans benefits received.
Just as a reminder: The federal government gives two tax credits and the tuition and fees deduction — the Hope credit (up to $1,650 for each eligible student), the lifetime learning credit (up to $2,000), and the tuition and fees deduction (up to $4,000, although it can only be applied once per return). Tax deductions are subtracted from taxable income; tax credits are subtracted from the actual taxes owed.
Tax benefits reduced college expenses by $700 on average, significantly more than the $400 the recipients received in federal grant aid and veterans benefits combined.
[National Center for Education Statistics]
Please join the conversation about our stories on Facebook, Twitter, Instagram, Reddit, MeWe, Rumble, Gab, Minds and Gettr.