How to Calculate College Expenses on Taxes

Attending college has tax benefits.

College can be an expensive investment; fortunately, the government allows you to deduct certain education expenses against your income for the purposes of taxation. Tuition fees and interest on student loans can, in certain situations, be deducted against your taxes. Calculate your education expenses and deduct them on your income taxes to keep your expenses down while paying for school.

Instructions

1. Add up the total value of interest payments made on qualified student loans. At the time of publication, you can deduct as much as $2,500 in interest payments if your modified adjusted gross income is less than $70,000.

2. Calculate the cost of any work-related education as a percentage of your gross adjusted income. If the expense exceeds 2 percent of your income, you can claim it as a deduction. The education must also be required to keep your current job and to maintain skills related to this current job.

3. Add up the total value of your tuition fees. At the time of publication, if your modified adjusted gross income is less than $65,000, you can claim up to $4,000 of your tuition. If your modified adjusted gross income is between $65,000 and $80,000, you can claim $2,000 in tuition.

References

• H&R Block: Tax Tips & Calculators