College Education Hope Credit of 1997 Tax Act

College Education Hope Credit of 1997 Tax Act

Eligible for up to $1,500 in credits

Phase-outs and other details

Eligible for up to $1,500 in credits

100 percent credit for first $1,000 in college expenses

50 percent credit for second $1,000 in college expenses

Eligible expenses include tuition, but not books, room and board

Can apply credit for expenses incurred by yourself, spouse or a dependent

Use for expenses beginning in 1998

Credit indexed for inflation after 2001

Phase-outs and other details

Phase-outs

Single filers : modified AGI between $40,000 - 50,000

Married, joint filers : modified AGI between $80,000 - 100,000

Married, separate filers : NO CREDIT

Credit potentially reduced by scholarships or fellowship grants or employer-paid tuition already excluded from income

No credit if convicted of felony drug offense

Must be enrolled on at least half-time basis

Only first two years of college eligible for Hope credit

Mutually exclusive with lifetime learning credit or tax-free education IRA distributions

Can use one and only one of these three in a year

Nonrefundable credit - no credit if insufficient tax liability