Del Rey, Tanzi

If you or your child attends (or plans to attend) college, you may be eligible for tax breaks to help foot the bill. The new Consolidated Appropriations Act made some changes. The law repeals the Tuition and Fees Deduction for 2021 and later years. In addition, for 2021 and beyond, the new law aligns the income phase-out rule for the Lifetime Learning Credit (LLC) with the more favorable phase-out rule for the American Opportunity Tax Credit (AOTC). The LLC can be worth up to $2,000 per tax return annually while the AOTC can be worth up to $2,500 per student each year. Call us to discuss which tax credit is the most beneficial in your situation. Each has its own requirements.

Medical services and prescriptions are expensive. You may be able to deduct some expenses on your tax return but the rules make it difficult for many people to qualify. For 2020, the medical expenses are an itemized deduction that can only be claimed to the extent unreimbursed costs exceed 7.5% of your adjusted gross income. Medical expenses include refilling prescriptions, buying eyeglasses, going to the dentist and getting elective surgery.