Does Adult Education Count as a Tax Deduction?

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Tax benefits cover many types of adult education.
Tax benefits cover many types of adult education. (Image: Stockbyte/Stockbyte/Getty Images)

Adult education comes in many forms, from graduate school to English as a Second Language classes. No matter what level of education you are seeking or why you need it, there are a number of tax benefits that can help you pay for your class. In addition to deductions, you can also claim credits and get tax-free reimbursements from your employer. However, to receive most of these benefits, you need to be attending an accredited college or university.

Tuition and Fees Deduction

The tuition and fees deduction allows you to deduct up to $4,000, as of the time of publication. However, there are income restrictions; the more you make, the less you can claim. Tuition must be paid to an accredited institution of higher learning, so classes at nonprofit organizations and community centers do not apply. However, even basic adult education classes in writing, reading and math are now offered in colleges and universities, where the deduction would apply.

Business-Related Classes

If you are returning to school to strengthen your skills in an area where you already work, you may be eligible for both tax deductions and tax-free income. First, if your employer wants to pay you to take classes, he can give you up to $2,500 in tax-free reimbursements, as of the time of publication. Second, If your education is work-related, you may be able to claim a business deduction for the cost of your tuition if you itemize your deductions. In order for the deduction to reduce your tax liability, however, all of your business deductions must be more than 2 percent of your adjusted gross income.

American Opportunity Credit

If you are an adult returning to school in pursuit of a bachelor's degree, you may qualify for the American Opportunity Credit. This credit allows you to claim as much as $2,500 for up to four years of college, as of the time of publication. However, people with larger incomes may not be able to claim as much as those with lower incomes. People who make $80,000 or less filing single returns or couples who make $160,000 or less are eligible for the maximum credit.

Lifetime Learning Credit

Many adults go back to school not to get bachelor's degrees, but to do graduate work. Further, adults often take a few classes to help them improve certain skills, but they may not be enrolled in a degree program. In these cases, the American Opportunity Credit may not be available because students are not in their first four years of school. The Lifetime Learning Credit helps people in these situations pay for their tuition. You can claim up to $2,000 for tuition paid to receive postsecondary education. as of the time of publication. However, you cannot claim more than one tuition tax deduction or credit per year.

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