Friday, October 16, 2009

How to Cut College Costs ... A Sample List


Free advice Friday! The incredible costs of a college education have every parent and student concerned for their future plans. The following is a list of 3 out of 10 recommended methods to cut college costs. If you would like the rest of the list, email me directly and I will send you a PDF.


1. Get College Credit in High School: Students can take AP or IB college credited classes, with the help of a knowledgeable counselor, which will help to cut down on the number of courses needed to graduate from college. Most AP courses are paid for by the high schools so as not to deter students from enrolling. The tests are usually about $85 each and are far less than the cost of a college course, which is going to be a minimum of $500 at a university. Did you know? There are more than 30 AP courses and exams across multiple subject areas to choose from. Over 90% of 4-year colleges in the U.S. provide credit and/or advanced placement for qualifying scores. Dual college credit is another option. In Texas, ACC offers a program Early College Start (http://www.austincc.edu/ecs/) offered through your high school.  AP - Advanced Placement IB - International Bacc

2. Community Colleges: If you can convince your student, spending the first year or two in college at a CC is a huge cost savings. In many cases, students have yet to declare a major. In these cases, general education requirements can be fulfilled at a CC. The cost savings in tuition, books, supplies, housing, food, and travel may give a student and parent a head start on costs for graduate tuitions. Get your general ed requirements completed at Austin Community College.

3. Cash in on Tax Credits: “What students need to know is that there’s the Hope and the Lifetime Learning tax credits (http://www.nasfaa.org/AnnualPubs/TaxBenefitsGuide.html),” says Joseph M. Re, author of “Financial Aid Financer: Expert Answers to College Financing Questions.”

The Hope Credit is a tax credit for college students in their first two years of college. It provides a tax credit of up to $1,800 on the first $2,400 of college tuition and fees. You can claim the Hope Credit on your tax return if you, your spouse, or your dependent are a first-year or second-year college student, is enrolled at least half-time at an eligible education institution, and you are responsible for paying college expenses. (Only parents who claim the student as a dependent on their tax return would be eligible for the credit.) “The key to taking advantage of this credit,” Re says, “is to plan ahead and be aware of the stipulations.”
From the IRS government website, "Under the American Recovery and Reinvestment Act (ARRA), more parents and students will qualify over the next two years for a tax credit, the American Opportunity Credit, to pay for college expenses. The American Opportunity Credit is not available on the 2008 returns taxpayers are filing during 2009. The new credit modifies the existing Hope Credit for tax years 2009 and 2010, making the Hope Credit available to a broader range of taxpayers, including many with higher incomes and those who owe no tax. It also adds required course materials to the list of qualifying expenses and allows the credit to be claimed for four post-secondary education years instead of two. Many of those eligible will qualify for the maximum annual credit of $2,500 per student. The full credit is available to individuals whose modified adjusted gross income is $80,000 or less, or $160,000 or less for married couples filing a joint return. The credit is phased out for taxpayers with incomes above these levels. These income limits are higher than under the existing Hope and Lifetime Learning Credits."

The information provided was written by Lauren Kahn, CEO of Lone Star Ed Consulting. If you would like more information about Lone Star Ed Consulting's college planning services, please e-mail Lauren Kahn or call her at 512-294-6608.

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2 comments:

  1. Thank you so much for this helpful information on the hope credit. It is nice to know there are some tax benefits to pursuing post-secondary education.

    ReplyDelete
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Thank you for your comment. Your input is greatly appreciated. - College News from Texas - Lauren Kahn, M.A.

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