Certain credits, such as the American Opportunity Credit and Lifetime Learning Credit, were retained under the 2017 tax reform bill. Both the American Opportunity Credit and Lifetime Learning Credit provide tax breaks to help pay for education but apply to different stages. For undergrads, the American Opportunity Credit is worth up to $2,500 per year but can be used only for the first four years of college. Students must attend at least half of the time. To claim the full credit, your modified adjusted gross income (MAGI) must be $80,000 or less ($160,000 or less for married filing jointly).1 If you undertake training to maintain or enhance your job skills or pursue an additional degree, you may qualify for a Lifetime Learning Credit. This credit, of up to $2,000 per year, can help pay for undergraduate, graduate, and professional degree courses, and there’s no limit on the number of years you can claim the credit. To claim the full credit, your MAGI must be less than $80,000 for individuals and less than $180,000 for married couples filing jointly.2 Make too much to qualify? Those with higher modified adjusted gross incomes may qualify for a partial credit under either the American Opportunity Credit or Lifetime Learning Credit. Reach out today to learn more about these and other smart education planning strategies for you or your family members. |
1 https://www.irs.gov/credits-deductions/individuals/aotc |
This communication is designed to provide accurate and authoritative information on the subjects covered. It is not, however, intended to provide specific legal, tax, or other professional advice. For specific professional assistance, the services of an appropriate professional should be sought. |
Education Tax Credits: Not Just for Kids Anymore
