Should I take the lifetime learning credit or tax deductions?
On One Hand: Lifetime Learning CreditThe Lifetime Learning Credit allows you to reduce your tax bill by up to $2,000 (20 percent of $10,000) as of 2010. You can claim the Lifetime Learning Credit if you are enrolled in any higher educational classes as long as your modified adjusted gross income does not exceed the annual limits, which the IRS has set at $60,000 if you are single and $120,000 if you are married filing a joint return for 2010.On the Other: Tax DeductionsYou should claim the educational expenses tax deduction if you do not qualify for the Lifetime Learning Credit. The adjusted gross income limits for the deduction are higher than for the Lifetime Learning Credit. For 2010, you can deduct up to $4,000 if your AGI is $65,000 or less and you are single or $130,000 or less if you file a joint return. If your AGI falls between $65,001 and $80,000 for single filers or $130,001 and $160,000 for joint filers, you can deduct $2,000.Bottom LineThe Lifetime Learning Credit will sav
