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Author: japper Big red star, 1000 posts Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 121316  
Subject: re-posted: Tax benefits Date: 1/1/2002 11:55 AM
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Since I didn't get any replies, I am re-posting as follows:

I am trying to figure out what, if any, may be the better way to play the new tax laws on education expenses.

Here is the scenario:
1. FT employee, FT student
2. Education is non-temporary (greater than one year in length)
3. Enhances job (maintains/improves skills), does not lead to qualifying for a new career
4. Spent approx $15k in 2001 for tuition, books, travel for conference
5. Education expenses are not reimbursed by employer

From the reading in Pub 17 and Pub 508, I qualify for Lifetime Learning Credit as well as work-related expenses deductions. I will fall into the phase-out segment on the credit, have not calculated the exact reduction in the credit but it will not be the maximum allowed.

As I understand the rules, I can claim $5k in education expenses for the Lifetime Learning credit at whatever that phase-out works out to be. Now, can I also claim the work-related education expenses for the remaining $10k? I cannot find anything that states I cannot claim both the credit and the deduction. I did find a blurb that said I cannot claim the "same" expenses in mulitple places such as for the credit and the deduction.

Am I reading the rules correctly? Alternatively, it may be better to forego the Lifetime Learning credit and use the entire $15k as work-related but I don't want to raise red flags with our friends at the IRS either. I try to be a conservative taxpayer and not go into gray areas most of the time.

thanks for your opinions,
Jenn
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