Minnesota Education Tax Credit and Subtraction
At Miacademy, we’ve been hard at work partnering with various state funding agencies across the country. Our goal is to make a quality education accessible for every student, and we’re accomplishing our goal one state at a time.
If you’re homeschooling in Minnesota, we have some exciting news to share with you!
Families can now receive a tax credit or subtraction for Miacademy’s accredited online homeschool curriculum with the Minnesota Education Credit and Subtraction.
What is the MN Education Tax Credit and Subtraction?
The Minnesota Education Credits and Subtractions program is designed to help families afford educational expenses. The program aims to reduce the overall cost of a child’s education by offering tax benefits to families. It is available to parents of K-12 students in both public and private schools.
The education credit is a refundable tax credit that allows families to claim a percentage of their qualifying education expenses, while the subtraction allows for a reduction in taxable income. Both programs cover a variety of expenses that support a child’s education outside the standard school curriculum. Qualifying expenses for the subtraction or credit include:
- Fees for tuition and instruction, such as enrichment programs, tutoring, and music lessons provided by qualified instructors
- Purchases of required educational materials
- Costs paid to others for transportation to and from school
- Educational software and computer hardware for personal use at home
However, expenses like materials used outside the school day, transportation for activities outside the school day, and room and board do not qualify.
For the subtraction, your child must attend a school within Minnesota or neighboring states. Certain expenses qualify only for the MN education subtraction, including:
- Private school tuition
- Tuition for college or summer school courses that satisfy high school graduation requirements
- Instructor fees for mandatory summer school
- Transportation costs covered include fees paid to others for getting your child to and from school
- Personal computer hardware and educational software, excluding items used for business purposes and non-educational games
Required school materials like non-religious textbooks, musical instruments, and educational equipment also qualify, provided they are used for teaching standard public school subjects.
To claim these, your child must have attended a school in the five-state area (Minnesota, Iowa, North Dakota, South Dakota, or Wisconsin).
Who Qualifies for the MN Education Credit and Subtraction?
The criteria to claim the credit and subtraction are different, so please be sure to read carefully:
Education Credit
To qualify for the Education Credit, the following must apply:
- Your filing status is not Married Filing Separately.
- Your adjusted gross income (AGI) is below the income limit for the amount of qualifying children:
- For 1-2 children, your AGI must be less than $76,000.
- For 3 children, your AGI must be less than $79,000.
- For 3+ children, your AGI must be less than $79,000 + $3,000 for each additional child.
Your credit is limited to 75% of the qualifying expenses you paid during the year for your qualifying child’s K-12 education, up to the maximum amounts. You may not use the remaining 25% of qualifying expenses to claim the subtraction.
The maximum credit you may claim is based on your adjusted gross income and number of qualifying children in grades K–12.
Your maximum credit limit is determined when you complete Schedule M1ED to include on your income tax return.
Education Subtraction
If you purchased educational material or services for your child’s K–12 education, you may be able to subtract your qualifying expenses from your taxable income (up to certain maximum amounts) when you file your Minnesota income tax return.
The Minnesota education tax deduction allows up to $2,500 to be subtracted for each dependent in grades 7-12 and up to $1,625 for each dependent in grades K-6.
In the case where a child went from 6th grade to 7th grade during the calendar year, the maximum for that child is $2,500.
There is no family maximum subtraction, only a per-child maximum. Last year, families saved an average of $1,285 with the Education Subtraction.
Unlike the K-12 Education Credit, there is no income limit to qualify for the K–12 Education Subtraction. Although you may qualify for the subtraction regardless of your filing status, your child must have attended a school in Minnesota, Iowa, North Dakota, South Dakota, or Wisconsin.
How Do I Get Miacademy with the MN Education Credit and Subtraction?
To use your MN Education Credit or Subtraction with Miacademy, simply claim your Miacademy curriculum expense or MiaPrep Online High School subscription on your Minnesota state tax return. Be sure to save all invoices as proof of payment.
If you’re wondering whether Miacademy or MiaPrep would be the best homeschool curriculum for your family, feel free to reach out to our friendly customer service team! They’ll be happy to help you with any questions you may have.
Information accurate as of: 7/2/2024. The information provided on this site is intended for research purposes only. Miaplaza is not responsible for any errors, omissions, or outdated information, or for the results yielded through use of this information.