Education Credits and 529 Plan Benefits Expanded

The American Recovery and Reinvestment Act provides better education cost breaks to more taxpayers for 2009 and 2010. Computers, certain software and internet access can be covered by tax free 529 plan distributions as long as they are used by an eligible student while enrolled at an eligible institution.  The ARRA also replaces the Hope education credit with the American opportunity credit.  Key changes from the Hope include: books are now eligible expenses, an increase in the amount of credit available, and higher income limits for eligible taxpayers.  Click here to view more information on IRS.gov.