Can I Claim an Education Credit for My Child Attending College?
You may be able to claim an education credit for your child attending college if the eligibility requirements for either the American Opportunity Tax Credit (AOTC) or the Lifetime Learning Credit (LLC) are met. These credits help offset the cost of higher education.
Eligibility Requirements
- Your child must be enrolled at or attending an eligible educational institution.
- You must be able to claim your child as a dependent on your tax return. If your child is your dependent, only you can claim the education credit, even if your child paid the expenses.
- You cannot be claimed as a dependent on another taxpayer's return.
- Your filing status cannot be Married Filing Separately.
- You must meet the modified adjusted gross income (MAGI) requirements for the credit being claimed.
- The student must have a valid taxpayer identification number (TIN) issued on or before the due date of the return (including extensions).
Types of Education Credits
For 2025, there are two education credits available:
- American Opportunity Tax Credit (AOTC): Up to $2,500 per eligible student per year. Generally, the student must be pursuing a degree, certificate, or other recognized education credential, be enrolled at least half-time for at least one academic period beginning during the tax year, not have completed the first four years of postsecondary education before the beginning of the tax year, and not have claimed the AOTC (or former Hope Credit) for more than four tax years. Up to 40% of the credit may be refundable if all requirements are met.
- Lifetime Learning Credit (LLC): Generally equal to 20% of qualified education expenses up to the annual limit allowed by law. This credit is nonrefundable and may be claimed for undergraduate, graduate, professional degree, and job-skills courses.
Qualified Education Expenses
Qualified expenses include tuition and certain related expenses required for enrollment or attendance at an eligible educational institution.
For the AOTC, qualified expenses generally include:
- Tuition
- Required fees
- Books
- Supplies
- Equipment needed for a course of study
For both credits, expenses that do not qualify generally include:
- Room and board
- Insurance
- Medical expenses
- Transportation
- Personal living expenses
Qualified education expenses must generally be reduced by tax-free educational assistance, including tax-free scholarships and grants, employer-provided educational assistance, veterans' educational assistance, and certain other tax-free benefits.
How to Claim the Credit
- To claim an education credit, you must file Form 8863, Education Credits (American Opportunity and Lifetime Learning Credits), with your federal income tax return.
- The form requires information about the student, the educational institution, and the qualified education expenses paid during the tax year.
- OLT (Online Taxes) software can guide you through adding Form 8863 to your return. Navigate to the Federal section, select Education Tax Credits, and follow the on-screen instructions to add or edit Form 1098-T information and complete the education credit interview.
Important Considerations
- The credit is based on adjusted qualified education expenses paid during the tax year for an academic period beginning during the tax year or during the first three months of the following year.
- A Form 1098-T alone does not determine eligibility for an education credit. Additional records may be needed to determine qualified education expenses.
- Income phaseouts, dependency rules, filing status restrictions, and student eligibility requirements may reduce or eliminate the available credit.
- For detailed guidance, refer to Publication 970, Tax Benefits for Education.
Source:
Form 8863
Publication 970
Disclaimer: Always verify details with official IRS forms, instructions, and publications from the Federal or State Department of Revenue.