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The document you linked in your question refers to the expansion of allowable tax-free distributions from 529 plans. If you have a 529 plan, you may take a tax-free distribution to purchase computer equipment, educational software, and Internet access for a qualified beneficiary. The American Opportunity Credit gives a credit for tuition, fees, and required materials and equipment. If the student is required to have a computer for his course of studies, the purchase could be included in the computation of the credit. The AOC gives a credit of up to $2,500, and 40% of that can be paid as a refund even if no tax is owed. There are eligibility requirements. The student must be in the first four years of post-secondary education. There are also income restrictions.

by ninasgramma

4 months ago

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There's a lot of tax breaks for parents in that act, but I've never heard of anything regarding the purchase of laptops. Care to share your source for this information? Here's a pretty decent discussion of what *is* in the act: en ...

by rtfm- 4 months ago

No, ARRA added computers to the list of items that could be purchased with 529 funds, not to the list of expenses under the Hope deduction. However, for taxpayers with AGIs up to $160,000, the new HOPE deduction maxes out at $2,500, not $1,800 as in prior years.

by Steve D- 4 months ago

Steve is right. You need to do a little more homework on the subject! Unless the purchase is coming out of your child's 529 account, your deduction is ZERO.

by Ryan M- 4 months ago