<p>Very often on this forum we hear things like "… if you are poor you can get a PELL grant, otherwise everyone is eligible for a direct student loan and that’s about it … " or “… only poor people get grants …”. the reality is the AOC is a very generous federal subsidy to the vast majority of folks in the country even in the middle-upper class. Students are often encouraged to ask their parent how much they are willing and able to contribute to college expenses. After the parent give them a dollar figure the student should say something like … “and I can add the 2.5K AOC tax credit to that amount, right?!”. It is true you need eligible expenses to claim this credit but the reality is if a family doesn’t have 4K of eligible expenses (including student loans) then I don’t think they really need the credit. We told our daughter we could contribute 10K per year to her college costs. But if I don’t include the 2.5 K AOC (b/c SHE took a direct student load) I’m really only giving her 7.5K. I’ve of course re-adjusted my thinking.</p>
<p>If YOU qualify. A single parent making over $75k per year gets NADA, even though I’ll have 2 in school, so $10k from me is $10k, not $7.5.</p>
<p>Why they think a single person can afford to send 2 to college without the AOC is beyond me. And yes, I consider a single making under $100k middle class.</p>
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You may get reduced AOTC. See <a href=“http://www.irs.gov/publications/p970/ch02.html[quote]The”>http://www.irs.gov/publications/p970/ch02.html
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<p>Sorry twoinanddone, didn’t mean to get into the “who is middle class” quagmire. Life (and taxes) aren’t perfectly fair. Your efc will be cut in half with two in college, right? Mine won’t. In any event. Part of me thinks the AOC is a bit too generous. My point was only that we should all remind new students/parents to the college scene that for many folks (not everyone) this is real money that can be used for higher education. </p>
<p>‘Your efc will be cut in half with two in college, right?’</p>
<p>Yes, but it is still the same amount that I’m supposed to pay, just to two different schools. Tuition is certainly not cheaper no matter if you have one parent or 6, so why should the AOC phase out be different if it is for a single or married parent? The ‘family’ is paying the same.</p>