3 Tax Tips For Back-To-School Savings In 2025 And Beyond

Some schools are back in session, but many families are still getting prepared for another back-to-school season — and the expenses that come with it. From tuition to backpacks and computers, parents may be looking for ways to save.

Families plan to spend an average of $858 on school supplies, clothing and electronics this year, down from about $875 in 2024, according to the National Retail Federation. Costs are even higher for families with college students, who expect to spend an average of about $1,326 in 2025, slightly less than $1,365 last year.

Although costs can be significant, families may qualify for tax breaks, says Holly Reid, a certified public accountant and founder of the Master Playbook, a financial education and wellness company in Atlanta.

“Whether a family takes advantage of a sales tax holiday, uses education tax credits or sets aside money for education costs, Uncle Sam may help you save on your back-to-school shopping,” Reid says.

Here are three tax breaks that could help.

1. Use state tax breaks for school expenses

Some states offer tax deductions or credits for back-to-school costs, reducing your tax bill when you file.

For example, Louisiana offers a school expense deduction for qualified dependents. Taxpayers may deduct up to 50 percent of qualified expenses, with a maximum deduction of $6,000, for costs paid for a K-12 dependent on supplies, uniforms, equipment or tuition. The deduction is available to Louisiana residents only, and taxpayers must keep records of expenses.

Minnesota also offers an education-related tax break referred to as a subtraction on their state’s tax return. Residents may claim up to $1,625 per qualifying child in grades K-6 and $2,500 for children in grades 7-12 for expenses such as textbooks, supplies, educational equipment and other items.

2. Claim the American Opportunity Tax Credit for college students

While the American Opportunity Tax Credit (AOTC) doesn’t apply to K-12 expenses, it can help families with college students.

The AOTC allows taxpayers to claim up to $2,500 per year for the first four years of college for expenses not reimbursed by scholarships. Qualifying costs include course materials such as books, supplies and required equipment, along with tuition and fees.

To qualify, the student must:

• Not have completed the first four years of higher education.
• Be pursuing a degree or recognized education credential.
• Be enrolled at least half time.
• Not have a felony drug conviction.
• Not have claimed the AOTC for more than four tax years.

Income limits apply. To claim the full credit, a taxpayer’s modified adjusted gross income (MAGI) can’t exceed $80,000, or $160,000 for married couples filing jointly. The credit is reduced for single filers with a MAGI between $80,000 and $90,000, and for joint filers between $160,000 and $180,000. It is eliminated for single filers with a MAGI of $90,000 or more and joint filers with a MAGI of $180,000 or more.

Families should save receipts and obtain Form 1098-T from the school to claim the credit, Reid says. “This is the ticket item the IRS needs to turn your back-to-school costs into a tax credit,” she says.

3. Make the most of sales tax holidays

One way to save is by taking advantage of your state’s sales tax holiday. While not all states offer these, the savings can add up for people who live in a state that does.

In 2025, 19 states offered sales tax holidays. Parents can use these holidays to save on items such as computers, electronics, school supplies, uniforms and more.

While states can schedule them any time, most occur in the summer to align with the peak of back-to-school shopping.

The rules vary by state, with many limiting qualifying purchases to $100 per item. But some states’ tax holidays are more generous. Massachusetts, for example, allows tax-free purchases of items worth up to $2,500 each.

“South Carolina offers one of the best sales tax holidays because, while it typically lasts three days, there’s no cap on the amount of back-to-school items you can purchase,” Reid says. “That’s great if you have a large family or need to buy more expensive items.”

Louisiana’s tax-free shopping holiday applies only to sportsman goods, not back-to-school supplies. One municipality in Alaska provides a break on local sales taxes (the state is one of five that doesn’t levy a sales tax).