Typically when you hear “distribution planning,” you think of retirement. However, the tax planning that goes into retirement planning can be applied to other major expenses; namely, paying for college. Education funding is tricky for a whole host of reasons, and as CNBC explains, families should have a “distribution plan” in place when tapping assets to pay for education. After all, higher education has become one of the largest expenses a family will take on, so you want to research and take advantage of all the tax savings possible. Let’s take a look at how this payment strategy can provide significant tax savings for college-bound families.

Tax tips to help pay for college

One of the most important ways families with college-bound kids can save on taxes is by looking at college tax credits. For instance, the American opportunity tax credit offers up to $2,500 per undergraduate student for up to four years. For graduate and professional degrees, the lifetime learning credit offers up to $2,000 per eligible student per year.

Note: You can’t “double dip” tax breaks by claiming one of these credits and withdrawing money from a 529 college savings plan. This is where planning comes in, because in order to claim the full value of a tax credit, you’ll need to be prepared to cover a portion of tuition via your income or taking out loans.

Speaking of loans: In addition to credits, there are also tax deductions to consider. For anyone taking out loans, there’s a student loan interest deduction of up to $2,500. This benefit applies to all loans (not just federal student loans) used to pay for higher education expenses. Plus, student loans can give you the ability to claim the American opportunity tax credit above.

Many families default to 529 withdrawals as the most well-known avenue to get tax-free withdrawals for eligible education expenses. But when it comes the idea of distribution planning, it pays to compare different payment options. Although student loans are a daunting prospect, they may be the best strategy for you to get the most out of tax credits and deductions, and even tax-free loan forgiveness (for certain future nonprofit and government employees).

Ultimately, making the most of tax breaks while trying to put your kids through college is no small, simple endeavor. It’s important to be honest about your own limitations when it comes to this sort of financial decision-making. Consider enlisting the help of a financial advisor—one who won’t rip you off.