Tax season: tax tips for college parents

Tax season: tax tips for college parents
If you are a college student or parent, I would not be surprised if you filed your tax returns six weeks ago.

Why? Because you need financial information from your federal tax returns to file the Free Application for Federal Student Aid. And March 1 was the deadline for many of the financial aid programs that Monroe County students are eligible for.

Yes, you can file FAFSA with estimated tax figures and provide amended information later. Some families who participated in the College Goal Sunday program Feb. 10 at Monroe County Community College did just that.

I decided it wasn’t worth my time to fill out paperwork twice, and wanted all our financial figures correct from the start. I arranged to get our taxes done as soon as the IRS was able to accept our returns, and filed FAFSA and all the other paperwork well before the March 1 deadline.

Now, if you are just now starting to work on your 2007 tax returns, there are college tuition credits that you may be able to claim. But it’s a tricky set of calculations. Even my tax preparer was surprised when she ran the numbers. She got us a bigger tax refund than first expected when she took the time to compare all the options.

Daniel Wansten, president and founder of Professional Education Services, a college financial aid consulting firm in Grand Rapids, recently sent out a press release that was listed with other tax information on page 7A of the print and e-editions of The Monroe Evening News. If you missed the article, here are his tips:

When the Economic Growth and Tax Relief Reconciliation Act was passed several years ago, it turned a complicated situation into something even more complex. Following are a few points families of college students should consider when filing their taxes this year:

Withdrawals from qualified state tuition programs, such as Section 529 plans, are now tax-free. This provides greater control for the owner of such plans.
Coverdell ESAs (education IRAs) are bigger. Beneficiaries younger than 18 can receive up to $2,000 a year with a tax deduction for contribution.
With a Hope Credit, parents are eligible to receive a 100 percent tax credit on the first $1,000 of each child’s tuition fees for the first two years and a 50 percent credit for the next $1,000 worth of expenses in the same period.
Deductions for the interest paid on qualified student loans were raised to $2,500. Those earning more than $50,000, or $100,000 for joint filers, are ineligible for the full $2,500. This deduction is not available for those whose income exceeds $65,000 or $130,000 for joint filers.
Timing is crucial. Pay a tuition fee too early and you could find yourself unable to claim a tax credit.
Receiving one tax credit may make you ineligible for another. If you’ve paid for expenses with money pulled out of a 529 Plan, you cannot earn a Hope Credit.
Tax benefits received will impact your expected family contribution (EFC), the amount of money the family is expected to contribute for the year toward the student’s cost of attendance. This figure is compared to the cost of attendance to determine a student’s aid eligibility.

Posted: April 2nd, 2008 under College, Taxes.

You can get more incredible information about finacial aid and college funding by going to http://www.howtoaffordcollege.com.

Daniel Wansten News Interview

YouTube - Daniel Wansten, author of "Cash For College" in an interview about college funding.

Raising Money - $mart Kids

Raising Money - $mart Kids: "In 1999 Daniel Wansten founded Professional Education Services as one of the nations leading authorities on solving cash flow problems for families. Daniel has been seen on TV 13 news and featured in several newspapers and magazines. For free help on paying the college bill go to our website http://www.HowToAffordCollege.com and for free help with rollovers or other financial planning please contact our office at 866-949-7935."

How to Afford College

How to Afford College: "Watch the evening news interview Daniel Wansten on the 10 mistakes parents make and how to avoid them!
Dear Parent,"

The Man to see for College Funding

About Us: "Daniel Wansten is one of the nation's leading authorities for college funding solutions. Daniel founded Professional Education Services in 1999 with his wife Rebecca. Daniel educates people through community sponsored workshops and individual meetings. He has helped thousands of parents send their children to college without spending their life's savings or mortgaging their house to the hilt! Daniel is an ordained minister who is committed to the highest ethical standards of business and community service. He has been helping to solve family financial issues for over 20 years. To check out Daniels book "Cash For College", you should go to howtoaffordcollege.com. The decision to check out his book could change your finacial life forever.

StudentMojo.com

StudentMojo.com: "About Daniel Wansten and Professional Education Services
Daniel J Wansten is the author of CASH FOR COLLEGE and Founder of Professional Education Services. P.E.S. is an independent education consulting firm providing expert financial aid advice to college-bound students and their families. Based in Grand Rapids, Michigan, Professional Education Services also offers life coach counseling to determine which college or university best matches each student’s skill set. For more information, visit howtoaffordcollege.com

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