Hope Credit

The Hope Credit can be taken for qualified education expenses ranging from tuition to college fees received during the first two years of a taxpayer's, his/her spouse’s, or dependent's post secondary undergraduate education. A person cannot claim the Hope Credit if he/she is subject to the phase out because of the amount of your income. The Hope Credit is phased out as modified GI rises from $90,000 to $110,000 for joint IRS tax return filers.

For a student to be eligible to get the Hope Credit, he must be enrolled in one of the first two years of post secondary education or in a program that leads to a degree, certificate, or other recognized educational credentials. The student should not be convicted for possessing or distributing controlled substances like drugs and should have completed half of the normal work load in the institution for a period of the academic year. When obtained, the Hope Credit is not refundable and is available for up to 100% of the first $1,100 and 50% of the second $1,100 of qualified tuition and related expenses paid during a taxable year. As an alternative, eligible taxpayers may also elect to exclude themselves or their spouse or their dependants from taxable income amounts withdrawn from Education IRAs.