Dept. of Revenue: Families may qualify for back-to-school tax credits

For many Minnesota families, it is time to start back to school shopping. The Minnesota Department of Revenue notes that parents may qualify for a tax benefit on their 2017 Minnesota income tax return.

The Minnesota Department of Revenue is reminding parents that most school supplies could qualify for valuable K-12 tax benefits on their 2017 Minnesota income tax return. Parents should remember to save the receipts for school supply purchases to claim the tax credit or subtraction.

“Back to school time means parents will be investing in their children’s education by purchasing school supplies,” said Revenue Commissioner Cynthia Bauerly. “Keeping receipts for these purchases and claiming the K-12 education credit or subtraction can help parents save money during tax time.”

There are two tax benefits that help Minnesota families pay expenses related to their child’s education: the refundable K-12 education credit (income limits may apply) and the K-12 education subtraction (no income limits).

Both programs reduce the tax parents pay and could provide a larger refund when filing a 2017 Minnesota income tax return. To qualify, parents must have purchased educational services or required materials during 2017 to assist with their child’s education. The child must also be attending kindergarten through 12th grade at a public, private, or home school and meet other qualifications.

Remember to save your receipts to claim the credit or subtraction. You can visit the Revenue booth at the Minnesota State Fair in the Education Building and get special envelopes to keep track of your school supply receipts.

Generally, most expenses paid for educational instruction or materials qualify, including paper, pens, notebooks, textbooks, equipment rental, computer hardware, educational software, after-school tutoring and education camps taught by a qualified instructor.

K-12 education credit

To qualify for the K-12 education credit, households with one to two children must have an income of less than $37,500. For households with more than two children, the income limit increases by $2,000 for every child past the second.

Taxpayers who are not required to file an income tax return should do so in order to claim a refund for the education credit, if eligible.

K-12 education subtraction

There are no income limits to qualify for the education subtraction. Most parents qualify for the education subtraction. Parents can claim the K-12 subtraction for tuition paid to private schools or college courses used to satisfy high school graduation requirements.

Last year, more than 43,000 families received the K-12 education credit, saving them an average of $242. More than 199,000 families received the K-12 education
subtraction.