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Newspaper
Ottawa Herald
Location
Ottawa, Kansas, United States of America
Date
Feb 17, 2003
Page
3
Washington AP reports widespread changes from the 2001 tax cut affecting 2002 returns. New deductions and credits target college costs retirement savings and low income filers, while electronic filing expands access and some asset sales face capital gains taxes. Taxpayers are urged to consult IRS guides and plan ahead for 2003 as well.
Taxpayers gain a $3,000 deduction for tuition and fees with income limits, plus a $2,500 deduction for education loan interest. Credits include the Hope credit up to $1,500 and the Lifetime Learning credit up to $1,000, with phaseouts. The rules require choosing between credits and deductions and applying prior tax-free benefits first. For 2003 the Lifetime Learning credit rises, and Coverdell ESAs expand to $2,000.
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