Generally, you can claim the American opportunity credit if:

  1. You pay qualified higher education expenses,
  2. You pay the education expenses for an eligible student, and
  3. The eligible student is yourself, your spouse, or a dependent for whom you claim an exemption on your tax return.

Eligible Student

To be eligible for the American opportunity credit, the student must have been enrolled at least half-time in a program leading to a degree or other recognized educational credential for at least one academic period beginning in the year of the return.

A student may only claim the credit for a total of 4 tax years (including years in which the Hope credit was claimed), and only for the first 4 years of postsecondary education (usually freshman, sophomore, junior, and senior years of college).

Any conviction for felony drug possession or distribution makes the student ineligible.

Qualified Education Expenses

Qualified education expenses are tuition and certain related expenses (books, supplies, and equipment) required for enrollment or attendance. Materials do not need to be purchased from the educational institution to qualify.

Additional Information

You may not claim both the American opportunity credit and the lifetime learning credit for the same student in the same tax year. For more information on the differences between these credits, see 8863 Education Credits.

TaxACT will determine which education benefit is most advantageous for you based on the data entered on your return (such as income, filing status, amount of qualified expenses, etc). See Education Credits & Deductions for instructions on how to enter or modify your education information in TaxACT, or to compare the education benefits in your return.

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