for a joint return) is used to determine the reduction under Sec. 25A(d)(2) in the amount of the Hope Scholarship Credit. For taxable years beginning in 2012, a taxpayer's modified adjusted gross income in excess of $52,000 ($104,000 for a joint return) is used to determine the reduction under Sec. 25A(d)(2) in the amount of the Lifetime Learning Credit otherwise allowable.

Income from Savings Bonds for Taxpayers Who Pay Qualified Higher Education Expenses. For taxable years beginning in 2012, the exclusion under Sec. 135, regarding income from United States savings bonds for taxpayers who pay qualified higher education expenses, begins to phase out for modified adjusted gross income above $109,250 for joint returns and $72,850 for other returns. The exclusion is completely phased out for modified adjusted gross income of $139,250 or more for joint returns and $87,850 or more for other returns.

Earned Income Credit. For taxable years beginning in 2012, the maximum credit ranges from $475 for taxpayers with no children to $5,891 for those with three or more children. For taxable years beginning in 2012, the earned income tax credit is not allowed if certain investment income exceeds $3,200.

Qualified Transportation Fringe Benefit. For taxable years beginning in 2012, the monthly limitation under Sec. 132(f)(2)(A), regarding the aggregate fringe benefit exclusion amount for transportation in a commuter highway vehicle and any transit pass, is $125. The monthly limitation under Sec. 132(f)(2)(B), regarding the fringe benefit exclusion amount for qualified parking, is $240.

Adoption Credit. For taxable years beginning in 2012, under Sec. 23(a)(3) the credit allowed for an adoption of a child with special needs is $12,650. For taxable years beginning in 2012, under Sec. 23(b)(1) the maximum credit allowed for other adoptions is the amount of qualified adoption expenses up to $12,650. The available adoption credit begins to phase out for taxpayers with modified adjusted gross income in excess of $189,710 and is completely phased out for taxpayers with modified adjusted gross income of $229,710 or more.

Adoption Assistance Programs. For taxable years beginning in 2012, under Sec. 137(a)(2) the amount that can be excluded from an employee's gross income for the adoption of a child with special needs is $12,650; for other adoptions the amount that can be excluded is also $12,650. The amount excludable begins to phase out for taxpayers with modified adjusted gross income in excess of $189,710 and is completely phased out for taxpayers with modified adjusted gross income of $229,710 or more.