MN K-12 Education Subtraction or Credit — January 2012, reviewed January 2013

There are many expenses related to raising a child.  But at tax time they can help a family claim a number of credits including one that is ‘Minnesotan’, not a federal credit.  It’s the Minnesota K-12 Education Subtraction or Credit.  It is claimed on the state tax return.

 A family will qualify for the credit if they have one or two qualifying children and their annual income is $37,500 or less.  The maximum income to qualify rises in $2,000 increments for each additional child in grades kindergarten to grade 12.  If a family’s income is above this amount, it will become a subtraction.

If you have children in school, you need to be saving receipts for school expenses.  These are school supplies that are academically related, which doesn’t include sports.  The upper limit of expenses that can be claimed for the credit is $1,000 per child.  Amounts beyond $1,000 may be used as a subtraction.  It’s very important to save receipts as documentation in case of a tax audit.

Some examples of qualifying educational expenses include: pens, pencils, notebooks, tutoring or instructor fees, music lessons and instruments, and calculators.  In addition, a portion of home computer hardware and educational software maybe eligible, again if it’s academically related. 

If you want more information on the Minnesota K-12 Education Tax Subtraction or Credit, go to the Minnesota Department of Revenue website at www.revenue.state.mn.us.  Search for the Fact Sheet 8 MN K-12 Education Subtraction and Credit.  It includes information on what expenses would be acceptable and which would not.  It’s worth about 75% of your out-of-pocket school expenses back to you at tax time!  Save those receipts!