Is $4000 Tuition Deduction still available for 2018 tax year?

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celentano
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Is $4000 Tuition Deduction still available for 2018 tax year?

Post by celentano » Thu Oct 11, 2018 5:30 pm

I just read that this deduction has expired at the end of tax year 2017. Does anyone know if congress extended the deduction for 2018 tax year?

moneyman11
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by moneyman11 » Thu Oct 11, 2018 5:48 pm

Sounds like you may be talking about the "The American Opportunity Credit" which is a CREDIT, not a deduction, available for the first $4000 in qualifying tuition.

It is still available for the 2018 tax year.

You get a credit for 100% of the first $2000 in qualifying tuition, and a credit for 25% of the next $2000 in qualifying tuition, for a max credit of $2500 on $4000 in qualifying tuition. All of this is subject to AGI phaseouts.

More info:

https://www.irs.gov/credits-deductions/individuals/aotc
https://www.fool.com/investing/2018/03/ ... reaks.aspx

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HueyLD
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by HueyLD » Thu Oct 11, 2018 6:07 pm

celentano wrote:
Thu Oct 11, 2018 5:30 pm
I just read that this deduction has expired at the end of tax year 2017. Does anyone know if congress extended the deduction for 2018 tax year?
Per the Bipartisan Budget Act of 2018 signed into law Feb. 9, 2018, the Tuition and Fees Deduction has been extended for tax year 2017.

However, nothing has been done for 2018 and beyond. But they have had a habit of passing the 11th hour extension in the past. So, you just have to wait.....

celentano
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by celentano » Thu Oct 11, 2018 6:19 pm

HueyLD wrote:
Thu Oct 11, 2018 6:07 pm

Per the Bipartisan Budget Act of 2018 signed into law Feb. 9, 2018, the Tuition and Fees Deduction has been extended for tax year 2017.

However, nothing has been done for 2018 and beyond. But they have had a habit of passing the 11th hour extension in the past. So, you just have to wait.....
OK, thanks. Hopefully, I will know one way or other by the last week of December so that I can do my last minute adjustments/fixes to qualify for ACA Premium Tax Credits.

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abuss368
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by abuss368 » Thu Oct 11, 2018 7:35 pm

This is a credit and not a deduction.
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HueyLD
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by HueyLD » Thu Oct 11, 2018 7:52 pm

Hello folks,

There are education credits and there was a "tuition and fee deduction" before 2018 that was an adjustment to total income shown on the front page of the 1040.

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Kenkat
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by Kenkat » Thu Oct 11, 2018 9:27 pm

AOTC is still available - made permanent in 2018:

https://www.irs.gov/credits-deductions/ ... nd-answers

celentano
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by celentano » Fri Oct 12, 2018 8:03 am

Thanks, but I am not interested in AOTC. As I said before I am interested in DEDUCTION that goes on line 30 of Form 1040.

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HueyLD
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by HueyLD » Fri Oct 12, 2018 9:44 am

It is virtually impossible to guess what they may do before year end 2018. In addition, they have reinstated such a deduction in the middle of a tax season more than once in the recent past.

I think the OP needs to have both plan A and plan B in place so that he can optimize his AGI for the PTC.

h82goslw
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by h82goslw » Fri Oct 12, 2018 1:21 pm

Novice question....what’s the difference between a tax credit and a deduction? I’ll have approximately $13000 in college expenses this year, anyone have an estimate on how will this impact my bottom line? I’m not close to AGI phase outs.

tomd37
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by tomd37 » Fri Oct 12, 2018 1:25 pm

A deduction reduces your AGI and therefore taxable income. A tax credit reduces your tax dollar for dollar and is more valuable in most, but not all cases.
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Earl Lemongrab
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by Earl Lemongrab » Fri Oct 12, 2018 2:00 pm

Credits are generally much more valuable than deductions. If you aren't in a situation where your deductions are less than the standard deduction, then a new deduction might not reduce tax at all, or only some of it might.

The best credits are refundable ones. That means that you can even get a refund from the credit. Let's say you owe $500 in tax without a credit, then have a $1000 credit. You would get $500 back. Other credits would just zero out your tax.
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celentano
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Re: Is $4000 Tuition Deduction still available for 2018 tax year?

Post by celentano » Fri Oct 12, 2018 2:48 pm

HueyLD wrote:
Fri Oct 12, 2018 9:44 am
It is virtually impossible to guess what they may do before year end 2018. In addition, they have reinstated such a deduction in the middle of a tax season more than once in the recent past.

I think the OP needs to have both plan A and plan B in place so that he can optimize his AGI for the PTC.
Well, 'middle of tax season' is sounding real bad. Fortunately, I am working on Plan A, Plan B, Plan C, yes even a Plan D thanks to input from this great forum.

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