The compromise tax bill finally hammered out in Washington this week and approved by the U.S. House of Representatives just after midnight Thursday has some holiday goodies in it for college students and families. The Senate approved the measure earlier, and it now awaits President Obama’s signature.
In the compromise is an extension of a tuition tax credit and a student-loan interest deduction—both worth up to $2,500. It also provides an allowance of up to $2,000 in contributions per beneficiary to a tax-preferred Coverdell education savings account for qualified education expenses. You can also deduct up to $4,000 of tuition and fees you pay for a dependent, spouse, or yourself under the current bill.
Companies also have an added incentive to help their employees further their education. The legislation would provide a benefit that lets companies give employees up to $5,250 in tax-free tuition assistance.
With the high cost of tuition these days, every bit helps.