How Does the Stimulus Package Help Parents?

When it comes to the stimulus bill signed by President Obama yesterday, it’s safe to say that many Americans, especially parents, are asking…”But what will it mean for me?”  USA Today has a great article that breaks down how parents will be served by this groundbreaking piece of legislation.

Here’s an excerpt:

•Parents of college-bound students. The bill contains a more generous tax credit for higher education than the existing Hope college credit. Parents will be allowed to claim a tax credit of up to $2,500 a year to cover higher-education expenses. The income phaseouts are also higher than those for existing higher-education tax credits. Single filers with AGI of up to $80,000 can claim the full credit. Married couples can have AGI of up to $160,000 and claim the full amount.

In calculating expenses that count toward the credit, parents and independent students can also include the cost of textbooks and other course materials. That change could benefit students who attend community colleges or other schools with modest tuition rates, says Mark Luscombe, tax analyst for CCH. Including textbooks will increase the amount of the tax credit these students can claim, he says.



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