Many college students are caught in a balancing act between studying for their courses, working to pay expenses, and enjoying the social activities that college life has to offer. This is often stressful and overwhelming to some. Well, 1040Return.com wants to help relieve some of this financial burden by recommending the following tax credits below. 1040Return has helped several students receive their maximum refund because 1040 Return only asks you easy to answer questions so you do not ever have to fill out a complicated tax form on 1040Return.
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American Opportunity Credit Qualifications:
- Maximum credit: Up to $2,500 credit per eligible student. Limit on modified adjusted gross income (MAGI) $180,000 if married filing jointly; $90,000 if single, head of household, or qualifying widow(er) Refundable or nonrefundable 40% of credit may be refundable; the rest is nonrefundable
- Number of years of postsecondary education: Available ONLY if the student had not completed the first 4 years of postsecondary education before 2013 Number of tax years credit available. Available ONLY for 4 tax years per eligible student (including any year(s) Hope Scholarship Credit was claimed).
- Student must be pursuing a program leading to a degree or other recognized education credential
- Number of courses: Student must be enrolled at least half time for at least one academic period that begins during the tax year
- Felony drug conviction: As of the end of 2013, the student had not been convicted of a felony for possessing or distributing a controlled substance
- Qualified expenses: Tuition, required enrollment fees, and course materials that the student needs for a course of study whether or not the materials are bought at the educational institution as a condition of enrollment or attendance
- Payments for academic periods: Payments made in 2013 for academic periods beginning in 2013 or beginning in the first 3 months of 2014
- Maximum Credit: Up to $2,000 credit per return
- Limit on modified adjusted gross income (MAGI): $127,000 if married filling jointly; $63,000 if single, head of household, or qualifying widow(er)
- Refundable or nonrefundable: Nonrefundable—credit limited to the amount of tax you must pay on your taxable income
- Number of years of postsecondary education: Available for all years of postsecondary education and for courses to acquire or improve job skills
- Number of tax years credit available: Available for an unlimited number of years
- Type of program required: Student does not need to be pursuing a program leading to a degree or other recognized education credential
- Number of courses: Available for one or more courses
- Felony drug conviction: Felony drug convictions do not make the student ineligible
- Qualified expenses: Tuition and fees required for enrollment or attendance (including amounts required to be paid to the institution for course-related books, supplies, and equipment)
- Payments for academic periods: Payments made in 2013 for academic periods beginning in 2013 or beginning in the first 3 months of 2014
Lifetime Learning Credit
- Maximum Credit: Up to $2,000 credit per return
- Limit on modified adjusted gross income (MAGI): $127,000 if married filling jointly; $63,000 if single, head of household, or qualifying widow(er)
- Refundable or nonrefundable: Nonrefundable—credit limited to the amount of tax you must pay on your taxable income
- Number of years of postsecondary education: Available for all years of postsecondary education and for courses to acquire or improve job skills
- Number of tax years credit available: Available for an unlimited number of years
- Type of program required: Student does not need to be pursuing a program leading to a degree or other recognized education credential
- Number of courses: Available for one or more courses
- Felony drug conviction: Felony drug convictions do not make the student ineligible
- Qualified expenses: Tuition and fees required for enrollment or attendance (including amounts required to be paid to the institution for course-related books, supplies, and equipment)
- Payments for academic periods: Payments made in 2013 for academic periods beginning in 2013 or beginning in the first 3 months of 2014
Have you qualified for either of these credits?
Photo Credit: David Castillo Dominici
Wade says
October 8, 2018 at 2:14 pmHi, Robert! I have a question regarding the American Opportunity Tax Credit. My daughter will be graduating with a BS degree in May 2019. She went to community college in high school (dual enrollment) and for one year after high school (got her associates degree in May 2017). Her first semester at the 4-year university was in the Fall of 2017. We first took the AOTC for 2017, and we plan to take it for 2018 as well. We would like to take it for 2019 since she will be attending her last semester in the Spring of 2019. However, the university bills the spring semester in November with payment due in December. I understand that the AOTC can only be taken during a year in which tuition/required fees are PAID. The university does have a payment plan that can spread the payment over several months into 2019 (I think 2 payments will be required in 2018 and 3 payments due in 2019). The total payment due to the university for the semester will be approximately $9,000 with tuition/required fees totaling approximately $3,500 (~40%) and the remaining $5,500 for room/board. I am thinking about using the payment plan so that some of the payments will be in 2019. If I do that, would each payment be prorated for AOTC purposes (i.e. 40% of each payment will be for tuition/fees), or can I claim that the payments were frontloaded for room/board so that all of the tuition/fees will be classified as 2019 payments? Thanks!
Robert Farrington says
October 9, 2018 at 1:44 pmPayment plan sounds like a good choice if you want a 2019 tax credit. It’s always based on what’s paid in what tax year. You will get a 1098-T for tuition paid in 2019 for any amount paid that year.