If you, your spouse or a dependent are heading off to college in the fall, some of your costs may save you money at tax time. You may be able to claim a tax credit on your federal tax return. Here are some key IRS tips that you should know about education tax credits:

  • American Opportunity Tax Credit. The AOTC is worth up to $2,500 per year for an eligible student. You may claim this credit only for the first four years of higher education. Forty percent of the AOTC is refundable. That means if you are eligible, you can get up to $1,000 of the credit as a refund, even if you do not owe any taxes.
  • Lifetime Learning Credit. The LLC is worth up to $2,000 on your tax return. There is no limit on the number of years that you can claim the LLC for an eligible student.
  • One credit per student. You can claim only one type of education credit per student on your tax return each year. If more than one student qualifies for a credit in the same year, you can claim a different credit for each student. For instance, you can claim the AOTC for one student, and claim the LLC for the other.
  • Qualified expenses. You may use qualified expenses to figure your credit. These include the costs you pay for tuition, fees and other related expenses for an eligible student. Refer to IRS.gov for more on the rules that apply to each credit.
  • Eligible educational institutions. Eligible schools are those that offer education beyond high school. This includes most colleges and universities. Vocational schools or other postsecondary schools may also qualify. If you aren't sure if your school is eligible:
    • Ask your school if it is an eligible educational institution, or
    • See if your school is on the U.S. Department of Education's Accreditation database.
  • Form 1098-T. In most cases, you should receive Form 1098-T, Tuition Statement, from your school by Feb. 1, 2016. This form reports your qualified expenses to the IRS and to you. The amounts shown on the form may be different than the amounts you actually paid. That might happen because some of your related costs may not appear on the form. For instance, the cost of your textbooks may not appear on the form. However, you still may be able to include those costs when you figure your credit. Don't forget that you can only claim an education credit for the qualified expenses that you paid in that same tax year.
  • Nonresident alien. If you are in the United States on an F-1 Student Visa, the tax rules generally treat you as a nonresident alien for federal tax purposes. To find out more about your F-1 Student Visa status, visit U.S. Immigration Support. To learn more about resident and nonresident alien status and restrictions on claiming the education credits, refer to Publication 519, U.S. Tax Guide for Aliens.
  • Income limits. These credits are subject to income limitations and may be reduced or eliminated, based on your income.

Visit IRS.gov and use the Interactive Tax Assistant tool to see if you are eligible to claim education credits. Visit the IRS Education Credits Web page to learn more. Also see Publication 970, Tax Benefits for Education. You can get it on IRS.gov/forms at any time.

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Upcoming Tax Dates

May 2 — Social security, Medicare, and withheld income tax
File Form 941 for the first quarter of 2017. Deposit or pay any undeposited tax under the accuracy of deposit rules. If your tax liability is less than $2,500, you can pay it in full with a timely filed return. If you deposited the tax for the quarter timely, properly, and in full, you have until May 10 to file the return.

May 2 — Federal unemployment tax.
Deposit the tax owed through March if more than $500.

May 2 — Form 720 taxes
File Form 720 for the first quarter of 2017.

May 2 — Wagering tax
File Form 730 and pay the tax on wagers accepted during March.

May 10 — Employees who work for tips
If you received $20 or more in tips during April, report them to your employer Details

May 10 — Social security, Medicare, and withheld income tax
File Form 941 for the first quarter of 2017. This due date applies only if you deposited the tax for the quarter timely, properly, and in full.

May 11 — Communications and air transportation taxes under the alternative method
Deposit the tax included in amounts billed or tickets sold during the first 15 days of April.

May 13 — Regular method taxes
Deposit the tax for the last 15 days of April.

May 16 — Social security, Medicare, and withheld income tax
If the monthly deposit rule applies, deposit the tax for payments in April.

May 16 — Nonpayroll withholding
If the monthly deposit rule applies, deposit the tax for payments in April.

May 25 — Communications and air transportation taxes under the alternative method
Deposit the tax included in amounts billed or tickets sold during the last 15 days of April.

May 27 — Regular method taxes
Deposit the tax for the first 15 days of May.

May 31 — Wagering tax
File Form 730 and pay the tax on wagers accepted during April.

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