PARSIPPANY, N.J., Sept. 22, 2011 /PRNewswire/ -- Millions of students who recently headed back to school will continue to have an important tax benefit available to them, thanks to the extension of the American Opportunity Credit. According to Jackson Hewitt Tax Service®, taxpayers who continue their educations during the 2011 and 2012 tax years should keep this credit top of mind.
Through the American Opportunity Credit, eligible students can claim a credit of up to $2,500 for qualified tuition and related expenses. The credit can be claimed for the first four years of a student's postsecondary education, provided that the student is enrolled at least half time in a qualified program and has not been convicted of a felony drug offense. Expenses covered through this credit include tuition and required fees paid to a qualified institution, along with the cost of required books, supplies and equipment for a course of study.
"The extension of the American Opportunity Credit through the next two tax years is a real benefit to those pursuing higher education," explained Mark A. Steber, chief tax officer, Jackson Hewitt Tax Service Inc. "But with this and all other tax credits and deductions, it is critical to keep relevant documentation, so that benefits can be properly claimed when a 2011 tax return is filed."
In addition to the American Opportunity Credit, Steber highlighted additional education-related tax considerations, including:
- Lifetime Learning Credit: You may be able to claim the Lifetime Learning Credit of up to $2,000 each year for the total qualified tuition and related expenses paid. This credit is not based on workload and is not limited to the first four years of postsecondary education. It is important to note that you cannot claim both a Lifetime Learning Credit and American Opportunity Credit for the same student in the same year.
- Student loan interest deduction: You can deduct up to $2,500 of the interest paid on a qualified student loan to attend an accredited, higher education institution. The loan can be for you, a spouse or a dependent.
- Tuition and fees deduction: You may be able to deduct up to $4,000 for qualified tuition and fees paid for higher education even if you do not itemize deductions. Qualified tuition and fees are amounts paid for you, a spouse or a dependent. The tuition and fees must be required for enrollment or attendance at an eligible educational institution.
To learn more about education deductions and credits, please visit www.jacksonhewitt.com or call 1-800-234-1040 to find a local Jackson Hewitt office.
About Jackson Hewitt Tax Service Inc.
Based in Parsippany, NJ, Jackson Hewitt Tax Service Inc. is an industry-leading provider of full service individual federal and state income tax preparation, with franchised and company-owned office locations throughout the United States. Jackson Hewitt Tax Service® also offers an online tax preparation product at www.jacksonhewittonline.com. For more information, or to locate the Jackson Hewitt® office nearest to you, visit www.jacksonhewitt.com or call 1-800-234-1040. Jackson Hewitt can also be found on Facebook and Twitter.
SOURCE Jackson Hewitt Tax Service Inc.