Do any tax planning considerations apply to the education tax credit?
For an academic period (quarter, semester, etc.) beginning in the first 3 months of a calendar year, you can pick which year to pay the expense and take the credit. That is, pay in December 2008 and take the credit in 2008 or pay in, say, February, 2009 and take the credit in 2009. Your family may be able to save tax by foregoing the education credit and taking an available exemption for program distributions instead.
For an academic period (quarter, semester, etc.) beginning in the first 3 months of a calendar year, you can pick which year to pay the expense and take the credit. That is, pay in December 2009 and take the credit in 2009 or pay in, say, February, 2010 and take the credit in 2010. Your family may be able to save tax by foregoing the education credit and taking an available exemption for program distributions instead.
A. For an academic period (quarter, semester, etc.) beginning in the first 3 months of a calendar year, you can pick which year to pay the expense and take the credit. That is, pay in December, 2005 and take the credit in 2005 or pay in, say, February, 2006 and take the credit in 2006. Your family may be able to save tax by foregoing the education credit and taking an available exemption for program distributions instead.
