Id like you to meet The Students Both Joe and Jane are 28 years old They live in Genesee County They have been married for 5 years They have a 3-year old daughter, Mary

More about Joe and Jane Joe went into construction after high school but unfortunately has been laid off more than employed for the past 4 years Jane is a paralegal, attending MCC at nights working on transfer program

Joe and Jane in 2011 This was an especially rough year for the Students Joe was laid off most of the year and and had to collect nearly $11,000 in unemployment benefits $11K = almost 1/3 of their Household Income

Financial Aid Jane applied for a Pell Grant at MCC Unfortunately she was ineligible due in part to the fact that the EFC Formula considered their family earnings and Adjusted Gross Income of $39,787 too high for a family of 3 Fortunately, MCC offered a payment plan that helped tremendously Pell Grant

Tax Time March 2012 In March, 2102, the Students filed their tax return Due to their income level and a new Higher Education Tax credit, the Students were delighted to receive a refund of $2,178 for their tuition Net Tuition Cost for Full Time for 1 Year at MCC = $535 Comparable to Tuition and Fees in or $21/contact hour

More in 2012 Joe and Jane were advised by their CPA If Jane continued to attend MCC Jane should reduce her federal withholdings from her job to receive this much needed refund throughout the year instead of tax-time Jane made the payroll adjustment as advised Reduce withholdings CPA

More in 2012 Tax Year 2012 CPA calculated that tuition/fee amounts = $2,957 for 24 contact hours Higher Education Refund (from improved tax credit) = $2,239 Net tuition/fee for full-time = $718 or $29/contact hour or rates

American Opportunity Tax Credit (AOTC) How did they get this?

Pell American Opportunity Tax Credit (AOTC) Pell for Most Everyone Else Maximum Award$5,550$2,500 EnrollmentSliding Scale up to full-timeAt least Half Time Income LimitsExpected Family ContributionModified AGI< $80,000 Single < $160,000 MFJ Program of StudyDegree or Certificate-Accredited Institution Can be used forTuition, fees, books, equipment, supplies, leftover can be for living expenses Tuition, fees, books, equipment, supplies Length of Award6 years4 years Other EligibilityNot convicted of a felony drug offense Available Financial Aid Pell and American Opportunity Tax Credit (AOTC) Estimated - $14.3 Billon available annually for AOTC

$ Increase AOTC Refundable Credit 12 Hours Total tuition/fees increase (475.44) (495.88) (579.72) (634.79) (2,185.83) Tuition Increases and Amount Refunded from the AOTC (1,769.05)

Tuition Increases and Amount Refunded from the AOTC $ Increase AOTC Refundable Credit 24 Hours Total tuition/fees increase (826.32) (836.05) (870.12) (895.78) (3,428.28) (2,698.54)

(2,782.79) $ Increase AOTC Refundable Credit 30 Hours Total tuition/fees increase (880.05) (892.09) (932.72) (964.33) (3,669.19) Tuition Increases and Amount Refunded from the AOTC