Save Receipts for Your College Textbooks
Going back to class this fall? While some textbooks are being transferred to the cloud , chances are good that you will have to buy or rent at least a few textbooks for college. And there is always one professor who gets everyone to buy the latest edition of the textbook, even if it costs $ 80 more than last year’s version. But you may be able to recover some of these costs.
After you’ve emptied your wallet at the campus bookstore , stash your receipts in a safe place until tax season begins. You may want to refer to them when preparing to file your return.
Since the IRS considers books, supplies, and equipment to be necessary expenses for your education, it allows you to deduct them from your annual tax return.
This deduction is part of the US Tax Credit , which allows undergraduate students to deduct educational expenses from their taxes, including tuition, room and board, transportation, and all those additional fees that are in your account each semester. The tax credit is up to $ 2,500 per tax year.
Graduate students can deduct the cost of textbooks with a lifetime student loan that covers education costs of up to $ 2,000 per year. (For graduate students, tuition fees can be deducted as a separate deduction, unlike the AOTC, which consolidates all education expenses into one credit.)
Of course, this is not cashback in your pocket, but anything that lowers your tax burden can help you stabilize your finances while you are in school.
The IRS has an online tool to help you select education-related credits or deductions that you may be eligible for. If you’re just getting to school or heading back off-campus after a while, you can take an eligibility survey to see what you can expect when it’s tax time.