After some final negotiations, Clinton and the Republican leadership finally agreed to a major balanced budget compromise, which included the Hope Scholarship and Lifetime Learning Tax Credit
; as well as capital gains and estate tax relief.
Anne Cervino, a graduate student entering her third year at the University of Colorado at Boulder, chose to take advantage of the federal Lifetime Learning Tax Credit
. By claiming the federal income tax credit (20 percent on the first $5,000 of tuition expenses), she could concentrate more on school and worry less about how she was going to pay for it.
The Lifetime Learning Tax Credit
is for qualified undergraduate and graduate school tuition expenses of up to $1,000 (20 percent of up to $5,000 of qualified expense) per taxpayer per year paid after June 30, 1998.
After June 1998, the Lifetime Learning Tax Credit
kicks in, letting taxpayers claim a credit of up to $1,000 for the first $5,000 they pay out of pocket for higher education, including graduate school.
Through the Hope Scholarship and Lifetime Learning tax credits
, families earning less than $32,000 annually save about $600, compared to the $900 in savings for families earning up to $59,999 and the $1,100 average credit for families earning up to $91,999.
This legislation, which included the HOPE and Lifetime Learning tax credits
, marked a new era of federal support for equalizing educational opportunity.
For example, little has been said about the possibility of eliminating federal income tax benefits such as Hope and Lifetime Learning tax credits
(only 30 percent of which go to families making less than $30,000), in order to provide more funding for Pell grants.
There are some minor differences in using the tax deduction or Hope and lifetime Learning tax credits
, but who can predict if they will still exist when a child goes off to school?
In fact, the low cost of community college tuition and the existence of Hope Scholarship and Lifetime Learning tax credits
mean this proposal will provide almost no additional assistance to community college students.
Focusing on the HOPE and Lifetime Learning tax credits
. Data from the National Postsecondary Student Aid Study and other databases were used.
Goggin, number 83); (9) Changing Industrial Employment Effects on Men and Women 1939 to 1998 (number 83); (10) Hope and Lifetime Learning Tax Credits
(number 83); (11) College Continuation Rates for 1998 High School Graduates (number 84); (12) The Decline of Need-Based Student Financial Aid 1978 to ?
It describes federal tax credits designed to help students and their families to meet the current expenses of college: the HOPE Scholarship and Lifetime Learning tax credits
, the new tax incentives concerning college savings, and the new provisions regarding student loans.