Thanks to the student debt crisis, many people are living the stereotypical “broke college student” lifestyle well beyond college. If you’re a recent college grad, you might be eligible for some financial relief in the form of tax deductions.
Fox Business reports on some common tax breaks. A couple of them include:
Student Loan Interest Deduction:
The average 2014 college graduate owes over $ 37,000 in student loans, according to the NCES. As graduates start receiving paychecks and paying off their debt, they can reduce their taxable income by as much as $ 2,500 for interest paid on both federal and private student loans, according to the Internal Revenue Service. Most borrowers who are single filers and who have adjusted gross income of less than $ 60,000 are eligible for the full deduction. Those with AGI between $ 60,000 and $ 75,000 are eligible for a reduced one.
Lifetime Learning Credit:
This tax credit is worth up to $ 2,000 for those who are paying qualified expenses for postsecondary education, or paying them for an eligible student. You need to have been in school at least part of that tax year to claim it.
They list a handful of other common deductions, too. If you’re paying for college, it’s definitely worth reviewing.
Tax Breaks for Recent College Grads | Fox Business
Photo by 401(K) 2012.
Two Cents is a new blog from Lifehacker all about personal finance. Follow us on Twitter here.