North American Precis Syndicate Parents looking for some practical strategies and financial guidelines for covering college costs are finding them in the College Board's newly updated book entitled Parents Guide to Paying for College ($14.95) by Gerald Krefetz. The book takes parents through the maze of savings options starting with the Taxpayer Relief Act of 1997, perhaps the most significant edu cational assistance from Washington in a generation. It includes two new tax credits created specifically to ease the burden of paying for college: • The Hope Education Tax Credit for college tuition offers up to $1,500 a year for the first two taxable years that a child is in college. Because it’s a tax credit, not merely a deduction, the govern ment will in effect match you dollar for dollar for the first $l,OOO in tuition and related expenses and 50 percent of the next $l,OOO in college tuition and fees incurred in the first and second years of college. • The Lifetime Learning Credit is available to parents after they’re no longer eligible for the Hope Education Tax Credit. Through 2002, it provides stu dents with a maximum annual credit of $l,OOO per family for tuition and fees. Starting in 2003, the credit increases to $2,000. In addition to tax credits, Parents Guide to Paying for College points out there are other non-traditional ways to pay for college that parents might not know about. These include: • Personal Gifts under the current tax code, a gift is not income and therefore has no tax consequence for the recipient. However, any amount given to one individual in excess of $lO,OOO a year is subject to a gift tax. • Business Gifts and Leasebacks as long as there is a legitimate business or invest ment need, there is a legitimate way of transferring equipment or items to a child's trust and leas ing it back from the trust for Tips On Paying For College business use. • Hiring Your Child the simple step of employing your child in some work capacity is perfectly legal and a deductible expense. , | # 4. ,Z ' ,«»|j Your student loan is nothing to take lightly. When you skip payments or default on your loan, you risk your chance for credit cards, car loans, and mortgages. So don't play around; if repayment gets to be too much, PHEAA can help. Learn more at yoUcan^g^'^''^ jß| or ca " • Borrowing From Your Retirement Plan - in many situ ations employees can borrow from their own retirement in the form of a loan. According to College Board DEFAULT on your student loai and this is where your CREDIT E ' ' \ m President Gaston Caperton, “It is important for parents to get sound advice about options available for college financing including financial aid, grants, scholarships or tax advantages. HISTORY NL ***** <#* • % Access m Mhcmm Early and long-t can significantly e; of paying college < For additional visit the College I at www.collegeboi
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