I have been trying to get my taxes done after my first born’s first year of college. I’ve seen where the Lifetime Learning Credit is limited to $2000, and the American Opportunity Credit to $2500, but I fail to see how those numbers come out actually using the worksheets and Form 8863. I also have heard you can’t take both, but I honestly don’t see where the two are separated on this form. If anyone has any experience with this form I’d appreciate any info you could provide. I’m leaning to claiming them both (putting amounts on both line 33 and 44 of 1040A) and let the IRS tell me what I have coming.
I don’t know the answer but suggest you post this on FInancial Aid & Scholarships. You might get more responses there.
We had Turbotax to figure it out (there are income limitations etc). And I still found it confusing. Good luck!
You can’t claim both credits for the same year for the same student. Answering the questions on lines 23 through 26 of form 8863 will direct you to complete the form for the credit that you are eligible for and/or gives you the most money. If you claim both credits for the same students, your return should be kicked back.
The AOTC is the better deal if you meet the income limits. No you can’t take both. With the AOTC you can get up to $2500 credit. The max required qualified expenses for that is $4000. The key is that up to $1000 is refundable and up to $1500 non-refundable. The non-refundable part can only reduce your tax to 0 at the most. For example if your tax is $750 on line 28 of the 1040a then the most non-refundable credit you will get is $750.
You’re going to have to be more specific about where you are having problems.
You start by filling out Part 3 for your son. The questions are pretty straightforward though you may have to look at the instructions occasionally. Line 30 of Part 3 tells you what to enter in Part 1, line 1 and you pick up from there through Part 2.
So start with Part 3 and tell us at which point you get stuck.
No, don’t claim both and let the IRS figure it out.
Read [IRS Publ. 970](http://www.irs.gov/pub/irs-pdf/p970.pdf).
i For each student, you can elect for any year only one of the credits. For example, if you elect to claim the American opportunity credit for a child on your 2014 tax return, you cannot use that same child’s qualified education expenses to figure the lifetime learning credit for 2014.
(page 9) If you claim the American opportunity credit for any student, you can choose between using that student’s adjusted qualified education expenses for the American opportunity credit or the lifetime learning credit. If you have the choice, the American opportunity credit will always be greater than the lifetime learning credit.*