Life Time Learning Credit

Lifetime earning credit means a tax-credit that is nonrefundable for the qualified fees and tuition. For the qualified-expenses which are paid after or on 1^st January, 2003, credit / tax-return as calculated is $2,000 i.e. 20 percent of $10,000 which is in the qualified-expenses. Not like Hope-Credit case, TRA didn’t provide or supply for value of Lifetime Learning Credit adjustment for the inflation. Credit is being set by legislation at twenty percent of 1^st $5,000 in qualified-expense / at max $1,000 for the years from 1999 – 2002.

As along with hope-credit, lifetime learning credits are made available for individuals, those who make payment for the expenses against qualified-higher studies of the students who are eligible and for those students exemption is claimed by the individuals on tax-return of their. Tuitions that are qualified and other expenses relating to it are all treated as well as calculated in same manner as it is done under Hope-credit, along with inclusion of reductions for the non taxable assistance of education that is received by students. Lifetime learning credit just like Hope-credit share same qualifying levels of income and phase out of income ranges.

For lifetime learning credit, students who are eligible are the students registered in 1 or various course of graduate as well as undergraduate teaching for acquiring or improving skills of job. One can claim for any number of years for Lifetime learning credit as it does not have any limit in respect of years.

A student who has claimed for Hope-credit cannot claim for lifetime learning credit for same year of tax. If a lifetime learning credit is claimed for an individual then that individual cannot benefit concurrently, for the qualified expenses for higher studied, from tax-deduction. Lifetime learning credit coordinates also with the other tax-benefits of education just like Hope-credit.

Questions:

• What is lifetime learning credit?
• How is similar to Hope-credit?