Recent Grads Should Keep Tabs

The amount of the credits begins to phase out once a married couple's AGI hits $87,000. The credits are eliminated when AGI reaches $107,000.

Both the parents and the student can't record this credit, so if your parents can't benefit, you might as well. The tuition, after all, is in your name, even if you were lucky enough to have your parents pick up the bill.

You can get the full credit if your AGI is $43,000 or lower, but once it goes over $53,000 as a single person you're done. So talk to your parents and see if you can take those credits in 2006.

Or maybe you decided to go back to grad school already. The Lifetime Learning Credit applies to graduate and professional degree courses as well. It equals 20% of the first $10,000 of the tuition and fees paid during the year. It maxes out at $2,000. So if you paid for some grad courses, you may qualify for this credit. Big note: You can't claim both the Hope and the Lifetime Learning credits in the same year.

And while 2005 was the last year for the tuition and fees deduction, which allowed you to deduct up to $4,000 of qualified higher-education expenses (i.e. tuition and fees), rumors abound that Congress is going to extend it for 2006. So stay tuned. We'll keep you posted.