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New laws are now in effect that govern various aspects of saving for college. A couple of major switches are new, higher limits for Education IRAs (in the kid's name, unfortunately ) and tax-free distributions for 529 plans. Here's one company's summary of the new developments: New Education Savings Changes.

By momom on Wednesday, January 02, 2002 - 06:54 pm: Edit

Can you take the HOPE tax credit and also deduct interest paid on PLUS Loans for the same student?

By Dadster on Saturday, January 05, 2002 - 10:53 am: Edit

Check with your tax person, but it seems like these would be separate deductions that wouldn't conflict. It appears that you CAN'T do the "Tax Deduction on Qualified Higher Education Expenses" and the HOPE in the same year, though.

By momom on Saturday, January 05, 2002 - 05:04 pm: Edit

Thanks for responding (Finally a response). It seems unfair not to be able to take both the same year since the HOPE Credit is only good for the first two years and the Deduction on Qualified Higher Education Expenses can only be taken in the first 60 months of the loan payback period. Any other people know the answer to this?