Tax Credits
Student Loan Interest Incentives
Hope Scholarship Tax Credit
Lifetime Learning Tax Credit | Student
Loan Interest Deduction
Hope Scholarship Tax Credit
Amount: The Hope Scholarship provides for up to $1500 in tax relief based on expenses associated with tuition and fees (minus scholarship, grants, and other tax-free educational assistance.) The assistance completely credits the first $1000 of expenses and 50% of the next $1000. Families can subtract the credit directly from their total tax owed.
Eligibility: Any student enrolled at St. Olaf (or any other recognized institution) that has not been convicted of possessing or distributing a controlled substance is eligible for the scholarship. Enrollment in only one course at St. Olaf qualifies a student for the credit.
Limitations: Only first and second year students are eligible to claim the credit. The credit is phased out proportionally within these adjusted gross income brackets:
- $80,000 to $100,000 for joint tax filers
- $40,000 to $80,000 for single tax filers
Relationship to Other Benefits: Claiming the Hope Scholarship may render you ineligible for other tax benefits. Specifically:
- The Lifetime Learning Credit may not also be claimed.
- Itemized education deductions may not also be claimed.
- Proceeds from an Education Individual Retirement Account may not be distributed tax-free.
The Hope Scholarship Tax Credit and the Lifetime Learning Tax Credit may be claimed in the same year on the same return by different family members.
Further information about the Hope Scholarship Tax Credit and other Federal Tax Benefits may be accessed through the Internal Revenue Service. Please review Publication 970 or IRS administrative notice 97-60.
DISCLAIMER: St. Olaf recognizes that information of this type is subject to editing and revision. Please consult with a tax advisor or the Internal Revenue Service for additional information.
Lifetime Learning Tax Credit
Amount: The Lifetime Learning Tax Credit provides for up to $1,000 in tax relief based on expenses associated with tuition and fees (minus scholarships, grants, and other tax-free educational assistance.) The assistance credits 20% of a families first $5000 of expenses. Families can subtract the credit directly for their total tax owed.
Eligibility: Any student enrolled at St. Olaf (or any other recognized institution) that has not been convicted of possessing or distributing a controlled substance is eligible for the scholarship. Enrollment in only one course at St. Olaf qualifies a student for the credit.
Limitations: The Lifetime Learning Tax Credit was designed for juniors, seniors, and graduate students who are ineligible for the Hope Scholarship. The credit is phased out proportionally within these adjusted gross income brackets:
- $80,000 to $100,000 for joint tax filers
- $40,000 to $80,000 for single tax filers
Relationship to Other Benefits: Claiming the Lifetime Learning Credit may render you ineligible for other tax benefits. Specifically:
- The Hope Scholarship may not also be claimed.
- Itemized education deductions may not also be claimed.
Proceeds from an Education Individual Retirement Account may not be distributed tax-free.
The Hope Scholarship Tax Credit and the Lifetime Learning Tax Credit may be claimed in the same year on the same return by different family members.
Further information about the Lifetime Learning Tax Credit and other Federal Tax Benefits may be accessed through the Internal Revenue Service. Please review Publication 970 or IRS administrative notice 97-60.
DISCLAIMER: St. Olaf recognizes that information of this type is subject to editing and revision. Please consult with a tax advisor or the Internal Revenue Service for additional information.
Student Loan Interest Deduction
Amount: Families can deduct up to $2,000 (FY 2000) or $2,5000 (FY 2001 and beyond) for expenses relating to interest that has accumulated on student loans. Qualified expenses for loans include tuition, fees, books, and transportation.
Eligibility: Any student enrolled at St. Olaf (or any other recognized institution) is eligible for the deduction. Enrollment in only one course at St. Olaf qualifies a student for the deduction.
Limitations: The deduction can only be claimed during the first 60 months of interest payments. Family members who take out loans are not eligible for the deduction. The deduction is phased out proportionally within these adjusted gross income brackets:
- $60,000 to $75,000 for joint tax filers
- $40,000 to $50,000 for single tax filers
Further information about Student Loan Interest Deductions and other Federal Tax Benefits may be accessed through the Internal Revenue Service. Please review Publication 970 or IRS administrative notice 97-60.
DISCLAIMER: St. Olaf recognizes that information of this type is subject to editing and revision. Please consult with a tax advisor or the Internal Revenue Service for additional information.
