Office of University Relations
SDSM& T News
501 E. St. Joseph Street • Rapid City, SD 57701- 3995
Phone: ( 605) 394- 6082/ 2554 • Fax: ( 605) 394- 6177
FOR IMMEDIATE RELEASE:
( December 30, 1997)
NEW EDUCATION TAX CREDITS TAKING EFFECT IN 1998 OFFER POTENTIAL BENEFITS FOR BOTH FULL AND PART- TIME SDSM& T STUDENTS
New education tax credits going into effect in 1998 have the potential to help many students— whether they are full- time, part- time, traditional or non- traditional— with the cost of obtaining a degree at the South Dakota School of Mines & Technology and other higher education institutions. SDSM& T officials encourage parents, current students and individuals interested in continuing education courses to check with their tax preparer to determine the potential effect of these new tax credits on their individual tax situation.
Both the Hope Scholarship and Lifetime Learning Tax Credits offer potentially significant tax breaks for many students attending the South Dakota School of Mines & Technology, according to Sharon Colombe, Financial Aid Director at SDSM& T. For taxpayers who qualify, the provisions might help alleviate the cost of higher education on both parents and non- traditional students. In addition, the Lifetime Learning Tax Credit has the potential to make continuing education courses more financially feasible for individuals already in the workplace who are interested in taking classes part- time to upgrade their job skills.
Following is a summary of the new tax credits:
$ 1,500 HOPE Scholarship: Beginning January 1, 1998, for students in the first two years of higher education, taxpayers will be eligible for a tax credit equal to 100% of the first $ 1,000 of tuition and fees and 50% of the second $ 1,000. The credit will be available on a per- student basis for net tuition and fees ( less grant aid) paid for college enrollment after December 31, 1997. Thus, the tax credit can not be taken for any tuition amount paid in 1997, but will be available when taxpayers file their 1998 tax returns in the spring of 1999. The credit is phased out for joint filers with incomes $ 80,000 and $ 100,000 and for single filers with income between $ 40,000 and $ 50,000. This amount is indexed after 2001.
Lifetime Learning Tax Credit for College Juniors, Seniors, Graduate Students and Workers Taking Classes Part- time to Improve Job Skills: Beginning July 1,1998, for those students beyond the first two years of college or taking classes part- time to improve their job skills, taxpayers can receive a 20% tax credit for the first $ 5,000 of tuition and fees through 2002. After 2002, the credit amount is 20% of first $ 10,000 of tuition and fee expenses. The credit is available for net tuition and fees ( less grant aid) paid for post- secondary enrollment after June 30, 1998. The credit is available on a per- taxpayer ( family) basis and is phased out at the same income levels as HOPE Scholarships.
“ I encourage everyone to check with their tax preparer to determine whether they might qualify for these new tax credits and to plan accordingly,” says Colombe.
The provisions were included in the 1997 Taxpayer Relief Act that was passed by Congress and signed into law last summer. Additional information about these and other education tax provisions can be obtained through the Department of Education web site at: www. ed. gov/ offices/ OPE/ PPI/ HOPE.
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Devereaux Library. South Dakota School of Mines and Technology.