Use Form 8863 to figure and claim your education credits, which are based on qualified education expenses paid to an eligible postsecondary educational institution. There are two education credits:
- The American Opportunity Credit, part of which may be refundable.
- The Lifetime Learning Credit, which is nonrefundable.
Can you claim more than one education credit this year?
For each student, you can choose for any year only one of the credits. For example, if you choose to take the American Opportunity Credit for a child on your 2021 tax return, you cannot, for that same child, also claim the Lifetime Learning credit for 2022.
If you are eligible to claim the American Opportunity Credit and you are also eligible to claim the Lifetime Learning Credit for the same student in the same year, you can choose to claim either credit, but not both.
- Based on the information in your return, our program will recommend the better of the two education credits.
If you pay qualified education expenses for more than one student in the same year, you can choose to take the American Opportunity and the Lifetime Learning credits on a per-student, per-year basis. This means you can claim the American Opportunity Credit for one student and the Lifetime Learning Credit for another student in the same year.
Who Can Claim an Education Credit?
You may be able to claim an education credit if you, your spouse, or a dependent you claim on your tax return was a student enrolled at or attending an eligible educational institution and received a 1098-T form. The credits are based on the amount of qualified education expenses paid for the student in 2022 for academic periods beginning in 2022 and in the first 3 months of 2023.
For example, if you paid $1,500 in December 2022 for qualified tuition for the spring 2023 semester beginning in January 2023 you may be able to use that $1,500 in figuring your 2022 education credit(s).
An academic period includes a semester, trimester, quarter, or other period of study (such as a summer school session) as reasonably determined by an educational institution. In the case of an educational institution that uses credit hours or clock hours and does not have academic terms, each payment period can be treated as an academic period.
Eligible educational institution:
An eligible educational institution is any college, university, vocational school, or other post-secondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education. It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) post-secondary institutions. The educational institution should be able to tell you if it is an eligible educational institution.
Certain educational institutions located outside the United States also participate in the U.S. Department of Education's Federal Student Aid (FSA) programs.
Who can claim a dependent's expenses?
Generally, qualified education expenses paid on behalf of the student by someone other than the student (such as a relative) are treated as paid by the student. However, qualified education expenses paid (or treated as paid) by a student who is claimed as a dependent on your tax return are treated as paid by you. Therefore, you are treated as having paid expenses that were paid from your dependent student's earnings, gifts, inheritances, savings, etc.
If a student is claimed as a dependent on another person's tax return, only the person who claims the student as a dependent can claim a credit for the student's qualified education expenses. If a student is not claimed as a dependent on another person's tax return, only the student can claim a credit.
What is covered?
The credit is based on qualified education expenses you pay for yourself, your spouse, or a dependent you claim an exemption for on your tax return. Generally, the credit is allowed for qualified education expenses paid in 2022 in connection with enrollment at an institution of higher education during 2022or for an academic period beginning in 2022 or in the first 3 months of 2023. The eligible educational institution must have issued a 1098-T with an amount in Box 1 to claim a credit.
For purposes of this credit, qualified education expenses are tuition and certain related expenses required for enrollment or attendance at an eligible educational institution.
Who cannot claim a credit?
You cannot take an education credit if any of the following apply:
- You are claimed as a dependent on another person's tax return, such as your parent's return.
- Your filing status is married filing separately.
- You (or your spouse) were a nonresident alien for any part of 2022 and did not elect to be treated as a resident alien for tax purposes.
- Your Modified Adjusted Gross Income (MAGI) is one of the following:
American Opportunity Credit: MAGI must be $180,000 or less if married filing jointly, or $80,000 or less if single, head of household, or qualifying widow(er). Taxpayers can get a reduced amount of the credit if their MAGI is higher than $80,000 but less than $90,000 (between $160,000 and $180,000 for joint filers).
Lifetime Learning Credit: $160,000 or more if married filing jointly, or $80,000 or more if your single, head of household, or qualifying widow(er). Beyond those limits the credit phases out.
To enter the education credit into your account, Log in and go to:
- Federal Section
- Select My Forms
- Credits Menu
- Education Credits Form 1098-T