Hope Scholarship
The Hope Scholarship is somewhat of a misnomer. It is not a scholarship at all. Rather, it is a tax credit available to certain taxpayers.
During the first two years of post-secondary education, students or parents may be able to take advantage of the Hope Scholarship tax credit. The credit can be as much as $1,500 per student per year for tuition and related expenses paid after December 31, 1997.
The tax credit will equal 100% of the first $1,000 of tuition and fees required for enrollment and attendance (not room or board) and 50% of the next $1,000 paid during the applicable tax year to an institution that participates in the U.S. Department of Education student aid programs.
To qualify, the student must have earned a high school diploma or equivalent degree, be enrolled at least half-time for one academic period during the tax year, and must not have been convicted of a federal or state drug felony.
The Scholarship is available to individuals with a modified adjusted gross income (AGI) under $40,000. For individuals, the credit is phased out for AGI’s between $40,000 and $50,000. The credit is also available to joint filers with AGI’s under $80,000 with the credit phased out for AGI’s between $80,000 and $100,000.
Eligible family members include the taxpayer, the taxpayer’s spouse and the taxpayer’s dependent(s).
Expenses paid after December 31, 1997 for education/academic periods beginning in 1998 may be eligible. You cannot combine the Hope Scholarship Credit with the Lifetime Learning Credit or the Education IRA in the same year for the same child.