You can choose to take a tax deduction rather than the college tuition tax credits noted above. A tax deduction is usually taken if income is too high for the tax credits. The tax deduction reduces your amount of income. The tax credits reduce the amount of tax you pay.
A $4,000 above the line deduction for qualified tuition expenses was extended through tax year 2016 by PATH, but starting in 2017, unless extended by Congress, the deduction will no longer be available.
Note: For tax years 2015 and 2016 a deduction up to $4,000 is allowed on if taxpayer's (modified) adjusted gross income is $65,000 or less ($130,000 or less on a joint return). If taxpayer's modified adjusted gross income is more than $65,000 but not more than $80,000 (more than $130,000 but not more than $160,000 on a joint return), a deduction is allowed up to $2,000.
A business expense deduction is also allowed without dollar limit, for education that serves the taxpayer's business, including employment. The deduction is also allowed for student loan interest; however, a taxpayer may not take more than one deduction for the same item.
