- My Dollar Plan - https://www.mydollarplan.com -

Form 8863 for Education Credits

What is Form 8863 Education Credits?

Form 8863 allows you to claim your education credits. You may be eligible for these credits for any expenses from your post-secondary or college costs.

There are two credits available: the American Opportunity Credit and the Lifetime Learning Credit.

What is the difference between the American Opportunity and Lifetime Learning Credits?

The American Opportunity credit:

  • The American Opportunity Credit [1] is refundable [2], which means you can receive a refund if the credit is more than your total tax.
  • You can receive up to $2,500 per student.
  • You qualify for this credit only for the first four years of post-secondary education.
  • You cannot claim the American Opportunity credit more than 4 years in a row for the same student.
  • You must be pursuing a degree for this credit. You also must be enrolled at least half time for at least one academic period.
  • You are not eligible if you have been convicted of a felony for possessing or distributing a controlled substance.

The Lifetime Learning Credit:

  • It is nonrefundable [2], which means if you qualify for it, it can reduce your tax to zero, but any excess is not given to you.
  • You can receive up to $2,000 per return.
  • You qualify for this credit all the years of post-secondary education including any courses to improve job skills. You do not need to be pursuing a degree.

What are qualified educational expenses?

You can claim tuition, required enrollment fees, and course materials.

When do you use Form 8863?

  • You can claim an education tax credit if you, your spouse, or any dependents you claim [3] on your tax return attended an eligible educational institute that year.
  • You cannot claim both the American Opportunity credit and the Lifetime Learning Credit for the same student in the same year.
  • You can’t take both an education credit and the tuition & fees deduction (Form 8917) [4] for the same student for the same year.

Form 8863

You can find the Form 8863 [5] at the IRS.

More Education Tax Topics