1. Business & Finance

The Stimulus Package and College Costs - An Update on the American Opportunity Tax Credit

From Ken Clark, About.com GuideFebruary 12, 2009

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This blog post was initially made when the American Opportunity Tax Credit had not been finalized. To read a finalized description of the credit and its rules for the current tax year, click here.

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As President Obama's stimulus package makes its way towards being law, many parents are asking if it includes any help with spiraling college costs. Specifically, many are asking whether the American Opportunity Tax Credit that was talked about during the election is finally coming to pass.

Well, here's what I can glean from my reading of the most recent version of the bill:

  • It appears the existing Federal Hope Scholarship is being renamed the American Opportunity Tax Credit, as opposed to the introduction of a completely new tax credit.
  • These benefits will apply to expenses paid in 2009 and after.
  • The American Opportunity Tax Credit is equal to 100% of the first $2,000 in expenses and 25% of the next $2,000, for a possible total of $2,500.
  • Students will be eligible for their first four years of college, as opposed to just the first two as currently allowed.
  • Books and courses materials will now be eligible for the credit
  • The adjusted gross income limit to qualify for the credit is raised to $80,000 for single taxpayers ($160,000 for joint).
  • Up to 30% of the credit may now be "refundable."

Details are still forthcoming, so be sure to keep checking back for updated information.

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Comments
February 19, 2009 at 8:34 am
(1) paul says:

is the new credit per student or per family

February 19, 2009 at 9:23 am
(2) collegesavings says:

As of right now, it appears to be per student.

February 20, 2009 at 8:25 am
(3) Janet says:

Does this credit apply to adult grad students? My 28 year old daughter is taking 1 grad class per semester, over $4,000. per year, unreimbursed. Is she eligible, or jus undergrad full timers?

February 20, 2009 at 9:17 am
(4) collegesavings says:

Regarding grad students… right now the American Opportunity Tax Credit is just for the first four years of undergrad. That’s actually a bump up from its previous incarnation as the Hope Scholarship, which only gave teh credit for the first two years.

However, your daughter would be likely be eligible for a different credit, the Lifetime Learning Credit, which is basically 20% of her costs up to a $2,000 limit. Alternately, she’d also be able to take the tuition deduction which got extended into 2009.

Here’s some links:

http://collegesavings.about.com/od/taxbreaksforcollege/a/lifetimecredit.htm

http://collegesavings.about.com/od/taxbreaksforcollege/a/deducttuition.htm

February 21, 2009 at 8:27 pm
(5) Jeremy says:

I’m in my third year of undergrad and am pursuing a medical career. Am I eligible for this savings next school year, and what are possible solutions for the next several years of school since I am going to be a surgeon? I’ll be in for the next seven years or so. Thank you for any advice.

February 22, 2009 at 2:33 pm
(6) collegesavings says:

Jeremy-

The American Opportunity Tax Credit is being extended to the first four years of college, so it sounds like you’re eligible.

In grad school, you’ll be able to claim the Lifetime Learning Credit which can save you up to $2,000 per year.

http://collegesavings.about.com/od/taxbreaksforcollege/a/lifetimecredit.htm

I’d also look into Loan Forgiveness Programs for doctors. They can save you some big time dough, just for working at certain facilities.

http://collegesavings.about.com/od/financialaid/a/loanforgiveness.htm

February 24, 2009 at 9:32 pm
(7) Elizabeth says:

Is there anything in the package for repayment of loans – as it stands I will finish paying for my education on social security

February 25, 2009 at 10:14 am
(8) Chuck says:

In 2009, will the American Opportunity Tax Credit also be allowed to be doubled (ie. $5,000)for anyone who attends college in the Midwestern Disaster Area? The previous tax code allowed the Hope Credit and the Lifetime Learning Credit to be doubled for tax years 2008 and 2009 for anyone attending college in the Midwestern Disaster Area.

February 25, 2009 at 7:22 pm
(9) Alea says:

I am currently a first year undergrad and would like to know when will this take in effect and how will i know if i can receive this benefit while attending a state school on financial aid?

February 26, 2009 at 2:06 am
(10) angie says:

I am a student and do not work. I live off of my college saving from my parents and financial aid. I usually do not file taxes, I have no income. Am I able to have a refund to pay off my loans, do I need to file without an income and if I do not pay taxes, how can I get help with my loans?

February 26, 2009 at 10:27 am
(11) Robert Treadway says:

My daughter works part-time and is also in her first year of college, part-time. I don’t claim her as a dependent on my tax forms. If I pay for her tuition and books, would I be eligible for the new tax credit or would she need to pay the expenses herself to be eligible for the credit?

February 27, 2009 at 12:02 am
(12) Terri says:

My husband and I have adjusted gross income of $204,000.00 In 2009 we will have 3 children in college. Any belief that the American Opportunity Tax Credit will be available to us?

February 27, 2009 at 10:44 pm
(13) Ken Clark, CFP says:

“Is there anything in the package for repayment of loans – as it stands I will finish paying for my education on social security”

Elizabeth, there is nothing in the current bill that helps to repay existing loans. There are some programs out there for certain professions though. Check out the article below.

http://collegesavings.about.com/od/financialaid/a/loanforgiveness.htm

February 27, 2009 at 10:50 pm
(14) Ken Clark, CFP says:

“In 2009, will the American Opportunity Tax Credit also be allowed to be doubled (ie. $5,000)for anyone who attends college in the Midwestern Disaster Area?”

As I understand it, no the AOTC will not be doubled under the Midwestern Disaster Provisions. However, qualifying parents can supposedly waive the new AOTC in favor of the old rules if it results in more money.

February 27, 2009 at 10:54 pm
(15) Ken Clark, CFP says:

“I am currently a first year undergrad and would like to know when will this take in effect and how will i know if i can receive this benefit while attending a state school on financial aid?”

The new American Opportunity Tax Credit applies to 2009 and 2010. However, if you started school in 2008, you can claim the Hope Scholarship for that period.

Here’s info on the Hope Scholarship
http://collegesavings.about.com/od/taxbreaksforcollege/a/hopecredit.htm

Yes, you can claim these credits even if you are on financial aid. However, they only apply to people who have paid some tuition costs out of pocket. If you’ve gotten a full ride, you won’t likely be able to use the credit.

February 27, 2009 at 10:58 pm
(16) Ken Clark, CFP says:

“My daughter works part-time and is also in her first year of college, part-time. I don’t claim her as a dependent on my tax forms. If I pay for her tuition and books, would I be eligible for the new tax credit or would she need to pay the expenses herself to be eligible for the credit?”

They haven’t specifically addressed this as far as I’m aware, BUT based on the how they previous credits operated, you’d only be able to claim her expenses if she’s a dependent. Otherwise, she’s got to pay them and use the credit.

February 27, 2009 at 11:01 pm
(17) Ken Clark, CFP says:

“My husband and I have adjusted gross income of $204,000.00 In 2009 we will have 3 children in college. Any belief that the American Opportunity Tax Credit will be available to us?”

Based on the last version of the Stimulus Package I saw, married filing joint couples are phased out between $160,000 and $180,000. So, at $204,000, I don’t think you’ll see any benefit.

March 4, 2009 at 10:20 am
(18) ADub says:

I’m curious how the IRS defines each year of undergrad… What about students who may have taken a few undergrad classes some years ago, then took a break, then came back to take community college classes?

2008 was the first year that the student was in a degree-seeking program with a regular part-time school schedule, but some of the credits from earlier classes will still count for him. Does he count as a freshman/first-year? Is the “first” year of undergrad designated by actual year or number of credits? Basically, I’m wondering if he’s eligible for the Hope Credit on his 2008 taxes and what kind of credits he might be able to take in the future. He’s paying out of pocket right now. Thanks!

March 7, 2009 at 10:50 am
(19) collegesavings says:

ADub-

It sounds like they’re still eligible to claim the credit for 2008.

March 29, 2009 at 9:36 pm
(20) Carolyn22 says:

We are married filing jointly with income at $150,000. We will have 4 children in college in 2009–each child’s tuition/book expense will exceed $4000 per student. All are claimed as dependents. Will we be eligible for a $10,000 tax credit in 2009? Please give me at references as I’d love to change my wihtholding if this is the case!

April 1, 2009 at 11:51 am
(21) sam says:

How can I apply for this Tax Credit? Or is it available yet…

April 15, 2009 at 12:46 pm
(22) HOWARD says:

are grandparents eligible for this tax credit for paying for their grandchildren’s tuition?

May 2, 2009 at 2:40 pm
(23) Joe says:

I am currently an undergrad with 6 credits left to graduate. I attended college from 04 – 08, and I took a break for the 08-09 school year. If I finish my degree as a part-time student for Fall 2009 (my 5th year as a student), could I receive the credit?

May 15, 2009 at 3:52 pm
(24) anthony says:

Does the parents have to be helping pay for your college to get this credit.Me and my wife both are currently enrolled in our first year of college.We are both majoring in Criminal Justice.

June 3, 2009 at 11:00 am
(25) Bob says:

How do I apply for this credit????

June 24, 2009 at 9:51 pm
(26) Jane says:

My son is beginning his 5th year of undergraduate classes in the fall. Is he eligible for the tax credit?

July 11, 2009 at 1:47 am
(27) collegesavings says:

Hi Bob-

To “apply” for the credit, you simply file your tax return. There will likely be an additional IRS form for the American Opportunity Tax Credit, but as of yet, they haven’t made it public.

For more information on claiming IRS tax credit for college costs, visit http://www.irs.gov/publications/p970/

July 11, 2009 at 1:55 am
(28) collegesavings says:

Jane says:

“My son is beginning his 5th year of undergraduate classes in the fall. Is he eligible for the tax credit?”

Ken says:

I don’t think so Jane. If he hasn’t been full-time in any of those years, you may want to talk to your tax expert about whether or not he can still qualify.

If he doesn’t you can still claim the 10% Lifetime Learning Credit. Here’s the info: http://collegesavings.about.com/od/taxbreaksforcollege/a/lifetimecredit.htm

July 22, 2009 at 3:49 pm
(29) dizzy979 says:

so there is no form yet to fill out to start the process?

July 24, 2009 at 1:49 pm
(30) Ken Clark, CFP says:

“So there is no form yet to fill out to start the process?”

Note yet, as far as I know. When the IRS releases the 2009 tax forms, there’ll be one for that.

August 7, 2009 at 12:43 pm
(31) William says:

Does the AOC apply to a returning student pursuing a second undergraduate degree, after already graduating with an undergraduate degree (30 years ago)?

August 7, 2009 at 4:20 pm
(32) collegesavings says:

“Does the AOC apply to a returning student pursuing a second undergraduate degree, after already graduating with an undergraduate degree (30 years ago)?”

As far as I’ve heard, it only applies to the first four years of undergraduate education, regardless of whether it results in a degree. So, if you’ve already had four years of undergraduate education in your life, you’re no longer qualified.

Keep checking back… If I hear any differently, I’ll post it here!

August 25, 2009 at 10:02 am
(33) amber says:

How do i apply for this??

August 26, 2009 at 7:51 pm
(34) Roxane says:

Any chance we might see a head of household mid range for these kinds of deductions. I am a single mom with 3 kids in college and make just over the max. Now, with one more mouth to feed and possibly additional car/insurance payment, a married couple in the same place as me financially can make twice what I do and get a credit. I don’t think the laws are really considering the plight of a single parent.

September 27, 2009 at 11:01 am
(35) collegesavings says:

“Any chance we might see a head of household mid-range for these kinds of deductions.”

It’s unlikely based on the history of the Hope Credit, which this replaced. Under that credit, single parents filing head of household and people filing as a true are lumped into one category. See the form below:

http://www.irs.gov/pub/irs-pdf/f8863.pdf

I hold out some hope though, since this credit was meant to help make college affordable for families who truly need it, as well as the fact that President Obama was raised in a “head of household” family for a portion of his life.

September 27, 2009 at 11:08 am
(36) collegesavings says:

Hi Amber-

To “apply” for the credit, you need to file your 2009 or later tax return. There will likely be an additional IRS form for the American Opportunity Tax Credit, but as of yet, they haven’t made it public.

For more information on claiming IRS tax credit for college costs, visit http://www.irs.gov/publications/p970/

November 17, 2009 at 11:41 am
(37) Kari says:

My daughter is a PSEO student that will be taking extra classes this summer that we will need to pay for. Since she hasn’t graduated from high school, but is in her 1st year of undergrad studies, do you know if we would be eligible for the AOTC?

December 1, 2009 at 5:56 pm
(38) Terry says:

Is this the “college for moms” program advertised on various websites? Is there a place to get more information, without the sales pitch? Thanks!

January 14, 2010 at 10:32 pm
(39) collegesavings says:

It’s a scam… President Obama has encouraged moms to go back to college, but there are no special programs run by the Federal government targeted towards moms.

December 4, 2009 at 7:11 pm
(40) Lori says:

I just started online schooling 2 months ago. I don’t work and my husband is on unemployment. Will we still be eligable for this credit.

January 14, 2010 at 10:31 pm
(41) collegesavings says:

You very will be eligible for the credit, which is even 40% refundable if you have no income tax to offset. However, your school would have to be an eligible institution, meaning that it is eligible to receive Federal financial aid (the money doesn’t go to the school, but that is how they make sure it is used for legitimate studies).

December 4, 2009 at 7:15 pm
(42) steve says:

I am on unemployment and my wife don’t work. SHe is attending school now. Even though we both don’t work can we still get the tax credit. She got half of her school payed for but we had to get a loan to pay for the rest.

December 28, 2009 at 5:51 pm
(43) glen burkett says:

I told my son who has two in college about the american opportunity credit. his answer was he uses turbo tax and if he had it coming turbo tax would have it in the software. Is he right or does he have to apply for the credit.

January 14, 2010 at 10:28 pm
(44) collegesavings says:

TurboTax has, in my experience, properly included the American Opportunity tax credit. With that said, all computer programs are subject to glitch and operator error, and TurboTax may not catch the American Opportunity tax credit if the info is not properly inputed.

December 29, 2009 at 10:43 pm
(45) Lisa Rodriguez says:

Hello,

Regarding AOC. I claimed Hope Credit for 2 years, does that disqualify me from claiming AOC?
My current status is undergraduate.

January 14, 2010 at 10:16 pm
(46) collegesavings says:

It should not. You should be able to claim the remaining two years as long as they’re actually your 3rd and 4th years (as opposed to 5th or later).

December 30, 2009 at 9:46 am
(47) David says:

Is the American Oppty credit available for first 4 years of “post-secondary education” or “undergraduate” only? Specifically – I graduated with BS degree in 3 years and now in my 4th year but in a masters program – am I eligible?

January 14, 2010 at 10:24 pm
(48) collegesavings says:

As far as all the governmental guidance we’ve seen, it is only available for undergraduate education, even if you finish in less than three years. However, you would be available for the lifetime learning credit, which can be worth up to $2,000 annually for as long as you are in grad school.

December 31, 2009 at 12:39 pm
(49) pearl says:

I took my BS in two years. Currently in my Masters program, on full scholarship. The classes I am taking full time are on the internet-DIstant Learning.
Is an eligible expense a laptop?
Am I eligible for the credit since I am in my third year of post-secondary education? It does say post-secondary and not undergrad or bachelors.

January 5, 2010 at 2:34 pm
(50) Leslie says:

I have been an undergrad student going to school part time for my degree since 2006. I took the hope credit for tax years 06 and 07. For 08 I took the tuition and Fees Deduction (I did not need the nonrefundable credit since I had several other nonrefundable credits.) Can take the American Oportunity Credit this tax year (2009) and next tax year (2010)?

January 8, 2010 at 8:45 am
(51) Matt says:

Are part time students covered?
Thanks

January 13, 2010 at 5:17 pm
(52) Harmony Kellerman says:

If my tuition was paid by shcholarships and grants yet I still had expenses for books, required uniforms, etc, can i take the credit on the books and other required materials?

January 14, 2010 at 6:04 pm
(53) Dee says:

I hope someone is still responding to questions here. I was wondering if anyone can point me in the direction of applying for any type of loan or grant that helps with expenses while I am in school. I have 3 daughters only 1 in school. I was going to wait till my youngest was in school to go back(which would be a lil over 2 more yrs.) and then I came to find online school.I was excited for this beause I will be finished by the time she is in school full time. I since am in my second quarter of courses and have been having a bit of a hard time. My 2 at home are 1 yr. apart and it has been almost impossible to give all the attention I need to my school work. I have heard of being able to see if you are eligible for added loans or grants that can help with other expenses so I could then put them into daycare even if it is just 1-2 days a week or 3 half days. I just need the time to concentrate. I already failed one of my classes in my first quarter of school. I can’t fail but 1 more I believe over the next 2 yrs of my associate degree program or I will loose my aid. So back to the question, does anyone know of anything I can apply for to get help with my at home expenses(particularly the help with my girls). Any info would be so appreciated. Thank you, Dee

January 14, 2010 at 10:14 pm
(54) collegesavings says:

Hi Dee-

There is nothing in particular on a Federal level to help with what you’re describing, aside from taking the maximum student loans possible and using excess money for living expenses. What state do you live in? I’d be happy to do some research and see if there is anything unique to your state.

January 20, 2010 at 3:01 pm
(55) mrodrick says:

I took one class here and there from 1998 to 2002. I then began school as a degree seeking student in 2006, I received my Associates in 2008 but took classes in 2009 for my 4 yr degree (so still undergrad). Am I able to claim the American Opportunity Credit for 2009? Basically I dont know if the 98-02 classes count.

January 22, 2010 at 12:52 pm
(56) collegesavings says:

The American Opportunity Tax Credit can be claimed for the first four years of of half-time education. As long as you have not had four years of half-time or greater education, I believe you should still qualify. Check IRS Publication 970 and with your tax preparer to be sure.

January 21, 2010 at 9:13 am
(57) Diane says:

My daughter graduated from college in 2009, and then moved out on her own, so we can’t claim her as a dependent, but we did pay her tuition and expenses, can we still deduct that from our 2009 return?

January 22, 2010 at 12:50 pm
(58) collegesavings says:

According to IRS Publication 970, you cannot claim the deduction for anyone who an exemption is claimed for on another tax return in the same year. If she files a her own tax return, I think you’re out of luck. I’d be sure to check with your tax preparer on that one. If any tax preparers read this, we’d love to hear your opinion as well!

January 24, 2010 at 12:19 pm
(59) Karah Morgan says:

I used the Hope Credit for my first to years of college education. I have been going part-time for several years. Can I take advantage of the American Opportunity credit? I am having a hard time understanding what the four years of undergrad study applies. Wouldn’t any years that are Freshman, Soph, Junior, Senior apply??

January 24, 2010 at 12:36 pm
(60) collegesavings says:

If you’ve only claimed the Hope Credit for two years and did not go to school full-time until 2009, you are probably still eligible. I would talk with your tax preparer to make sure.

January 25, 2010 at 4:49 pm
(61) yoli says:

It is my understanding that you must first pay 4k for college expenses and then you can get some of it back when you file taxes, how does this help people who are poor go to college? My daughter is 20 and would love to go to school to become an ultrasound technician but she can only find a part time job and has no idea where to get the money to pay for college upfront. She has no credit so loans are out of the question. What is a poor person with the desire to go to college supposed to do?
Does this apply for trade schools i.e. 2 year program for ultrasound tech?

January 25, 2010 at 6:06 pm
(62) Heather says:

I’m currently in my 3rd year, full-time, at a universit. I just heard about this tax credit and this is my question: My parents still claim me as a dependent on their taxes, but I have taken out student loans to pay for the majority of my schooling, so would I file on my taxes for the American Opportunity Tax Credit, or would my parents file for it since they still claim me? It would make sense that I’d file since I’m the one with the student loans in my name.

January 27, 2010 at 12:11 pm
(63) Mary says:

If I am receiving a pell grant, am I still eligible for the American Opportunity Credit?

January 27, 2010 at 12:30 pm
(64) kyle says:

I have been attending a school with a certificate program for the past year. This was funded by a sallie mae “career training loan”. I started paying the loan off in the middle of 2009. According to Sallie Mae, this loan is ineligible for a tax deduction on interest paid(1098E), but would I still be able to receive the American Opportunity Credit? Any help would be greatly appreciated. Thanks!

January 27, 2010 at 12:50 pm
(65) kyle says:

I should also add that I did not receive a 1090t form, and that my school is not eligible for federal aid. I am still asked this question when filing my taxes.

“If you have tuition NOT reported on a Form 1098, enter any tuition paid by or for KYLE during 2009 that was NOT reported on a Form 1098-T:
The amount you enter here will be added to the tuition amounts already shown on any Form 1098-T you entered.

January 28, 2010 at 9:34 am
(66) Michael says:

I completed my undergraduate degree after being a full-time student from fall 2005 until spring 2009. I am currently repaying my federal student loans. Do I qualify for the $10,000 credit?

January 29, 2010 at 11:32 pm
(67) KS says:

Do you know if the American Opportunity Tax credit affects or reduces elgibility for Pell Grant and other FA? Will you receive less money by accepting it?

February 2, 2010 at 12:07 am
(68) collegesavings says:

Hi KS -

The American Opportunity Tax Credit should not reduce your financial aid simply because you claim it. However, it could indirectly affect it slightly (by a few hundred dollars) by providing you with a larger tax refund, which means more money in the bank (assets that count in your Expected Family Contribution). Don’t let this be a reason to not take it though… It’s a huge credit and the effect on aid is minimal at best.

January 30, 2010 at 7:04 pm
(69) John N says:

My son was a full-time student in Spring 2009 (his last semester in college). Being a diligent person, my wife wrote the check (over $10,000) for that last semester on December 26, 2008, but it was to pay for Spring 2009. Does the fact that the check was dated 2008 (the last days of 2008!) disqualify us for the American Opportunity Credit? That seems so unfair…

January 31, 2010 at 7:54 am
(70) John N says:

Oops–I just look back at my previous tax materials and discovered that I’ve already taken this tax credit, in its earlier (and smaller) form, four times. That’s the max, so I wouldn’t have been eligible for this last semester of my son’s college career anyway. So no harm, no foul.

February 1, 2010 at 10:22 am
(71) Rob says:

I have taken classes from a few different schools since 2000. I have never received a degree and recently went back to school. I am taking 1st and 2nd year classes for an associates degree and I’m starting 3rd and 4th year classes for a bachelors. Am I eligible for this credit even though I’ve attended school in the past?

February 2, 2010 at 9:16 pm
(72) Mark says:

My wife and I are both students and both qualify for the lifetime learning credit. It does not seem like we can claim two credits (one for each of us) but I cannot find any information that states this directly. I read that we cannot claim the credit if we file separately so that is out. Can we claim two lifetime learning credits or are we stuck with just claiming one? Thanks

February 3, 2010 at 1:44 pm
(73) Thang says:

I had several Associate degree and I think I did claim hope tax 5 years ago. Now, last year I went back to school as full time with difference program and this is one is for 2 years degree. Can I claim American opportunity credit??

Thanks

February 3, 2010 at 10:56 pm
(74) KS says:

Tthanks for taking the time to answer my question!

February 6, 2010 at 1:01 pm
(75) anne says:

Daughter has a UGMA account that paid tuition can I as parent claim the American Opportunty credit I am custodian and paid through my checking

February 6, 2010 at 2:15 pm
(76) liz says:

I received a pell grant that completely covered my tuition and books it also left me with a refund. Can I claim the American Opportunity Credit or the Lifetime Learning credit? (I have an associates degree and returned to a different CC to get a certificate. I didn’t actually pay for any of my tuition.

February 6, 2010 at 5:11 pm
(77) Dee says:

Comment #47 by Harmony Kellerman was not answered. Do you know if American Opportunities can be used to pay for books and college supplies for first 4 years of college expenses if student qualified for grants for most of tuition, and rest of tuition was paid partially by Coverdell that covered room and board. The Coverdell now has no funds left over as it was entirely used up already and student is not even in 3rd year of college. Parent had to pay out of pocket for rest of college bill which includes tuition/room and board lumped together.
Anyways can books and other expenses be paid for even if no tuition was owed due to grants. Do you know?
Thanks for your time.

February 6, 2010 at 7:56 pm
(78) cris says:

I am doing my taxes with TaxCut and I had 2 full time college students in 2009. Both of them received some merit scholarships a couple of grants, (Pell, SEOG, etc) and student loans (subsidized and unsubsidized). On their 1098-T forms it will appear that all of their expenses are taken care of, but in reality the loans are being used to pay for her living expenses away from home while she is in school. If I put the tuition expense on the credit portion of my 1040, where do I plug in the scholarships and grants received? Do I add it to our income? Do I subtract it from their tuition amounts? Or do my children claim them on their own taxes? I have been reading conflicting directions as to what to do. PS Our household income in only $58,000.

February 7, 2010 at 9:06 am
(79) Melissa says:

Is this available for a student going back to school to pursue a second undergraduate degree? I lost my job 1 1/2 years ago and am now going back to school for a RN in nursing.

Thank you!

February 7, 2010 at 9:10 pm
(80) Brittany says:

I started college in 2004 and I continued, without completing any degree through the fall of 2008. I then began at a different college in the fall of 2009 so I would technically be considered a 5th year student, but I have not acquired the amount of credits to be considered a 5th year student according to college guidelines. Would I still be able to qualify for this credit?

February 8, 2010 at 6:34 pm
(81) Matt says:

I have a question, what does this mean:
– Up to 30% of the credit may now be “refundable.”

I just did my taxes a couple days ago, using TurboTax. When i finished inserting the information from my 1098-T Form (tuition statement), my refund jumped up to $1400 equivalent to my tuition for 2009. Is this correct? Was my tuition free?

February 8, 2010 at 6:47 pm
(82) collegesavings says:

Hi Matt-

This is actually an older article… The tuition is now 40% refundable. So yes, that is probably why your refund jumped. Essentially, the first $2,000 in tuition wipes out up to $2,000 in taxes that you owe. The next $2,000 in tuition, wipes out another $500. All told, spending $4,000 could save you up to $2,500 on your tax return.

February 8, 2010 at 9:50 pm
(83) dyahn says:

My son received scholarships, grants and loans in excess of his tuition. Since the loans were in excess of what was owed and are in his name, can we claim the American Opportunities Credit since we still claim him as a dependent? He uses the excess in loans for room and board and general living expenses. Thanks

February 10, 2010 at 10:29 am
(84) katie says:

I receive financial aid tap loans and grants part of it was billed to my tuition and the rest i used for books rent stuff for school, can i claim the difference as tuition expenses

February 11, 2010 at 11:20 am
(85) Tiff says:

I started to pay taxes in 2006 and i claimed the hope line credit the last two years (07/08) I have claimed the lifelong learners credit. I did attend a few college course here and there in 2003/2004 but did not file. Am I still able to claim the credit?

February 13, 2010 at 6:58 pm
(86) Rebecca says:

On my turbotax federal return, it wants me to enter a value into a line on my worksheet under non-taxable scholarships. Some of my tuition was covered by Pell grants, is this the information it wants? A pell grant is not a scholarship, and there’s a different line for pell grants, plus I never received a scholarship. Help!? Can’t find answer ANYWHERE!

February 15, 2010 at 11:24 am
(87) Terry says:

My Marine Reserve son is 20, earned $12000 in 2009, pays own tuition and books, medical, transportation and recreation expenses. He lives in my home and eats my food, but he cannot be claimed as my dependent. I would say he earns more than 1/2 his support, right? Turbo Tax says no AO tax credit. I think it should be $1000. What am I missing?

February 15, 2010 at 10:19 pm
(88) Kia says:

American opportunity tax credit gives me 1000$ credit When I adjusted it to my 1040 a form. I’m also going to apply for the financial aid this year which I had received above 2000$ in each last couple of years. Do you think I will get the same amount from F.A since I havn’t spend that much for tutions and fee supplies in 2009?

February 17, 2010 at 6:21 pm
(89) Laura says:

My husband earned his bachelor’s degree and then went back to school for another bachelor’s degree. Would we claim his tuition and earn this credit as a graduate student even though he is still in his first two years of the new program?

February 20, 2010 at 9:28 am
(90) elisabeth says:

If you were a full-time undergrad student from 2001-2005 (didn’t finish degree) and then completed a full-time one year technical program, paid your own expenses and never took the credit, are you eligible to take it now?

February 23, 2010 at 11:10 am
(91) Wanda says:

If a scholarship pays for more of the education than the parents paid in can you still use the hope credit?

February 23, 2010 at 5:57 pm
(92) Mallory says:

Just a few questions-
1) Is this tax credit only for full time students?
2) Can students who receive financial aid (pell grants) still get this tax credit?
Thank you,
M

February 25, 2010 at 11:10 am
(93) Kim says:

Dear Collegesavings
My husband and I are filling “married & joint” for tax year 2009. In August 2009, my husband got admitted to a College of Pharmacy and we paid $16K for the Falls semester in 2009 + $15K for Spring semester in early 2010. Is my husband’s tuition expense qualified for the American Opportunity Credit?
Thanks

March 4, 2010 at 8:02 am
(94) confused says:

I really would like to know if I can qualify for this credit, obviously it would help. I have my masters degree already and I went back last year for a degree in a different field and I am considered undergrad. Can I qualify for the american opportunity credit?
thanks

March 8, 2010 at 10:46 am
(95) Reed says:

I recently graduated in the spring of 2009 after 5 years of college (due to switching majors). I was still considered a senior during my 5th year since I was working towards completing my degree, however I had completed 4 years worth of credits before this 5th year (18 hour semesters my entire duration of college). My parents paid for the first 4.5 years, but this last semester in 2009 was all on me which I paid out of savings. I then got a job and have been working the remainder of the year. Turbo tax is showing me as eligble for this, but I question it since i was in my 5th year of undergrad. Does the gov still consider me in my first 4 years since I did not have a degree, or would I not qualify here?

Thanks :-)

March 12, 2010 at 10:29 am
(96) Hai Jie says:

My son is in fifth year of college but still taking the senior classes(I hope he will get his degree this summer), will he be eligible for the new American Opportunity tax credit?
Thanks,

March 20, 2010 at 9:54 pm
(97) yvonne says:

Similar question as above. I got my associate degree after two years’ study. Then I changed my major, it took me another three years to receive my B.S. I was called senior before graduation, though it was my 5th year in the university. Will I be still eligible for the credit? Thanks.

March 23, 2010 at 3:31 pm
(98) Rachel says:

I was a student for one semester in 2009. Can I claim the education credit even if my parents are claiming me as a dependent on their return this year?

April 6, 2010 at 12:10 pm
(99) Ana says:

My son graduated on spring 2009, Is he eligible for the credit? thanks

August 28, 2010 at 1:31 am
(100) JLM says:

Im not sure I understand. Im in college and I have just about all my college paid for by grants and scholarships, all except about 17 k. I have not paid anything out of pocket yet, Do I qualify for the Education Tax Credit?

December 8, 2010 at 11:14 am
(101) Mollie says:

I received a 4 year degree in 2003, the entire time I was in school my parents were claiming me as a dependent. As an adult, I am returning to school and pursing a nursing degree. I am about to start my second year in an undergraduate RN program. Can I use the American Opportunity Credit?

January 18, 2011 at 1:43 am
(102) jackie says:

do i qualify for the credit if i whent to school one semester and it was part time and i didnt even finish the semester???

January 18, 2011 at 1:45 am
(103) steven says:

can i get the credit if i whent to school part time for one semster and i didnt finish it and i was getting finacial aid?

January 24, 2011 at 3:30 pm
(104) Joelle says:

mollie, I have the same question. I already have 5 years of college under my belt. During 4 of those years in 2004-2008, my parents claimed me. My parents never had the opportunity to claim the Hope Credit, so I think it rather unfair that I can’t get the American Opportunity if we have never gotten this type of Government credit before.

I now claim myself and I am getting a second degree because the first degree did not work out. I’m screwed over.

January 26, 2011 at 11:23 pm
(105) Courtney says:

Hi I attended online schooling full time for 2 semesters in 2010. I had to withdrawal due to financial reasons. Am I eligible for this credit?? Thank you.

January 28, 2011 at 9:32 pm
(106) Angie says:

I went to my current college for one year 11 years ago. Then got an associates from a community college, and proceeded to take one full time schedule year at another school with subsequent part time years.

I have been out of school for 5 years but returned to my first school in 2010. So technically, my current school sees me as a second year senior.

Can I mark N/A for my “number of years completed as of 1/1/2010″ or do I need to mark “4 or more years completed”?

February 1, 2011 at 7:42 pm
(107) Ike says:

Hi, I started college in 2005 and after was claimed as by my guardian, for my first 3 years and then I switched majors, I started claiming myself last year and will be graduating with a degree this year. Do I qualify?

May 2, 2011 at 7:29 pm
(108) Sheri says:

If you attend college classes in a condensed summer courses equally half time, 6 credit hours are you eligible for this 2500 credt?

August 3, 2011 at 1:58 pm
(109) Fish says:

Am I supposed to repay the Amer Opp tax credit if I later received Pell for it. I got the tax credit for 2 semesters then later got Pell for 1 of them.

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