Tax Benefits for Education

For more information, visit the IRS Tax Benefits for Education Information Center.

Tax credits, deductions and savings plans can help taxpayers with their expenses for higher education.

  • A tax credit reduces the amount of income tax you may have to pay.
  • A deduction reduces the amount of your income that is subject to tax, thus generally reducing the amount of tax you may have to pay.
  • Certain savings plans allow the accumulated earnings to grow tax-free until money is taken out (known as a distribution), or allow the distribution to be tax-free, or both.
  • An exclusion from income means that you won’t have to pay income tax on the benefit you’re receiving, but you also won’t be able to use that same tax-free benefit for a deduction or credit.

 

To get more information about various subjects on this page, click the links contained in each section.

 

Credits
American Opportunity Tax Credit
Lifetime Learning Credit
Deductions
Savings Plans
Scholarships and Fellowships
Exclusions From Income