Several states are offering back-to-school sales tax holidays this season. Parents in Minnesota, however, could save more in the form of education tax credits from Minnesota on school supplies. To claim the education tax credits from Minnesota, parents need to hold on to their receipts for qualifying school supplies.
Education Tax Credits From Minnesota: What Is It?
Parents can benefit from two different programs that can help them pay for their child’s education – the K-12 Education Subtraction and the K-12 Education Credit. The first program has no income limits, while the second one has income limits, which is also based on the number of qualifying children.
“Both programs lower the tax you must pay and may even provide a larger refund when you file your Minnesota income tax return,” says the Department of Revenue.
To qualify for the education tax credits from Minnesota, the child must be attending kindergarten through 12th grade at a public, private or qualified home school.
You won’t be able to claim the K-12 Education Credit if your filing status is Married Filing Separately. Further, to qualify for the K-12 Education Subtraction credit, the qualifying child must attend a school located in Minnesota, Iowa, North Dakota, South Dakota or Wisconsin.
Regardless of income, under the K-12 Education Subtraction program, parents can subtract up to $1,625 for each child in K-6 and up to $2,500 for each child in 7th through 12th grade for school supplies.
On the other hand, parents get straight dollars off their tax liability under the K-12 Education Credit. As noted above, the income limit depends on the number of qualifying children.
For instance, the annual household income for a household with one or two qualifying children must be below $76,000. Eligible parents can get 75 cents for each dollar spent on supplies.
What Items Qualify And How To Claim
School supplies that qualify for education tax credits from Minnesota include notebooks, textbooks, paper, pens, computer hardware and software, after-school tutoring, educational summer camps by qualified instructors, and rental or purchases of education equipment like musical instruments.
Additionally, under the K-12 Education Subtraction, parents can claim tuition paid to private schools or college courses to meet high school graduation requirements. It must be noted that parents can’t use the same qualified education expenses to claim the credit under both the subtraction and the credit.
To claim the education tax credits from Minnesota, parents must have “documentation, such as itemized cash register receipts and invoices, to prove you paid qualifying expenses.”
According to the Department of Revenue, 17,000 families received an average credit of $280 under the K-12 Education Credit, and over 134,000 families received an average subtraction of $1,266 under the K-12 Education Subtraction last year.
Also, the department says that because of the changes made during the most recent legislative session, about 31,000 more families will be allowed to claim the credit this year.
Visit the Department of Revenue website for more information on the education tax credits from Minnesota.
