Above-The-Line Education Deduction

Through 2011, taxpayers are allowed up to a $4,000 above-the-line deduction for qualified higher education tuition and related expenses. Unless extended by Congress the deduction will no longer be available after 2011.

Taxpayers are allowed an above-the-line deduction for qualified tuition and related expenses for the year, to the extent the expenses are in connection with enrollment at an institution of higher education during that tax year, or if those expenses are in connection with an academic term beginning during that tax year or during the first 3 months of the next tax year.

The deduction is limited both by filing status and AGI. Unlike the other education tax incentives where the deduction is slowly phased out, this deduction is not allowed once the AGI limit is reached. Married individuals who file separately and taxpayers who are claimed as a dependent of another are not allowed to take this deduction. . 

Years 2004-2011

Filing Status

AGI Limit

Max Deduction

Joint

130,000

4,000

Joint

160,000

2,000

Others

65,000

4,000

Others

80,000

2,000


Since the expenses that qualify for this deduction are the same as those that qualify for the education credits, taxpayers may qualify for both and will be required to choose between the two. Each taxpayer’s individual circumstances must be taken into consideration before making the most beneficial decision. This office can assist you in making an informed choice.