Both versions of the tax bill– House and Senate– include changes to education tax benefits. One area of both change and confusion is college savings plans. The bills aim to consolidate some of the education plans: loans, tax credits and tax-preferred savings accounts. Continue reading College Savings Plans in the Tax Bill
For divorced parents, figuring out who is the custodial parent for FAFSA filing purposes can be a little confusing. Actually, the rules are pretty simple: the custodial parent is the one with whom the student spends the most time. That’s not necessarily the parent named custodial parent in the divorce decree, or the one claiming the student on their tax return. Continue reading FAFSA Custodial Parent
The tax bill that was finally introduced last week impacts higher education in a number of ways, most of them negative for students and families. Here is a quick summary:
Education tax credits: The bill slightly expands the American Opportunity Tax Credit but eliminates the Lifetime Learning Credit. While the AOTC is more generous than the LLC ($2,500 in tax credits for $4,000 in qualified expenses for the AOTC vs $2,000 in Continue reading Tax Reform Bill and College
Here is an article I wrote for another advisor’s site on college affordability.
As fall kicks into gear, students begin looking in earnest at colleges. Kids tend to focus on a few core aspects of colleges when creating and narrowing down a list: majors available, location, big vs small. Later in the school year, I get calls from panicked parents whose students have fallen in love with and often been accepted to wonderful Continue reading What Colleges Can You Afford?
I’ve probably said this before, but there are families staring down tuition payments for the first time right around now. Most families use a combination of savings, cash flow and borrowing to pay for college. The first two are reasonably straightforward; they’re yours, after all. Borrowing is more complicated, and chances are that if you have a high school student, you’re getting lots of mail about education loans that are available to you. Continue reading Borrowing: Where to Start
Today’s post is written by a fellow fee-only advisor, Greg Phelps, CFP®, CLU®, AIF®, AAMS®, of Redrock Wealth Management.
Saving for a child’s college education is perhaps one of the most noble things a parent will ever do. It’s also one of the toughest financial goals to tackle, because similar to healthcare costs, college expenses have risen across the board at 5% per year. Continue reading Can You Use a Roth IRA for College? Should You?
Before you sign up, you have to figure out how you’re going to pay for college each year. The first step in figuring that out is confirming with the school what has to happen for your aid package to be renewed. Then, consider the additional costs that aren’t included in the award letter—travel to and from school, activities your student intends to participate in, spending money. With all of those items written down, you have a good sense of what you’ll actually spend each year. This may seem really elementary, but most Continue reading Planning for College Cash Flow
Sallie Mae’s annual How America Pays for College report has some good news: In the 2015-2016 school year, the average amount families spent on college went down slightly, to $23,688. The biggest decline came on spending for 2-year colleges; families with students in 4-year schools reported spending about the same as in the previous year. In Continue reading How America Pays for College
Do you need to report 1099 q income on your tax return? As long as none of the distribution is taxable (i.e., you have qualifying expenses to offset it), NO, you do not have to report it.
However, you should keep records of your qualified expenses. That’s especially true if the Continue reading Tax Time Reporting: 1099 Q