4 tax breaks every US college student should know about

Americans ended 2017 with more than $1.3 trillion in outstanding student loan debt.
The IRS offers tax deductions and tax credits for college students that
reduce taxable income — and potentially lowers the amount a student needs to borrow.

Americans ended 2017 with more than $1.3 trillion in outstanding student loan debt — and they're finding it more difficult than ever to repay.

pproximately 22% of all Americans required to pay back their loans haven't, including those in grace periods, deferment, or forbearance, according to

When a debt hasn't been paid for 90 days after a scheduled payment, the loan is considered delinquent. If delinquency continues, a loan is at risk of going into default, usually after about 270 days for federal loans.

Luckily, there are a few tax deductions and tax credits available for undergraduate, graduate, and professional school students that help reduce the cost of tuition, so students won't have to borrow as much money and worry about repaying it later.

American Opportunity Credit

With the American Opportunity Credit students are eligible to claim up to $2,500 for the first four years of post-secondary education for tuition and fees, course-related books, supplies, and equipment. Couples filing jointly who earn less than $160,000 and single-filers who earn less than $80,000 are eligible.

And since 40% of the credit is refundable, that means students can get back up to $1,000 on their refund — even if they don't owe any taxes, according to the IRS.

Lifetime Learning Credit

The Lifetime Learning Credit allows students earning less than $66,000 (single-filers) or $132,000 (married, filing jointly) to claim up to $2,000 for education-related expenses.

Tuition and fees deductions

Like the American Opportunity Credit, students earning less than $80,000 (single) or $160,000 (married, filing jointly) can deduct up to $4,000 in tuition and fees on their annual tax returns.

Student loan interest deduction

If you've taken out a federal or private student loan, you're eligible to deduct up to $2,500 worth of interest paid on the loan as an "above-the-line" exclusion from your income. You don't have to itemize your deductions in order to claim it. Students with a