American Opportunity Credit

The American Opportunity Credit (AOTC) is a credit for qualifying out of pocket education expenses.

It is for the first four years of post-secondary education such as attending a college or university. This credit modifies the Hope Credit for tax years 2009 and 2010.

You can get up to $2,500 per eligible student.


Am I eligible?

The maximum amount of the credit is $2,500 and is available to individuals whose modified AGI is less than $80,000 or $160,000 for married couples filing a joint return. In order to be eligible, you must meet the following:

  • Pursue a degree or credential
  • Enrolled at least part tie for at least one semester
  • Have not completed four years of higher education
  • Have not claimed the AOTC or Hope Credit for more than four years
  • No felonies or drug conviction


How do I claim the credit?

Use Form 1098-T, a tuition statement provided by your school or indicate how much was tuition.  In order to claim this credit, you, your dependent, or another individual must pay for higher education expenses where you were enrolled.

Do not claim this credit if someone else, besides you, such as your parents list you on their tax return, your filing status if married filing separately, or you or your spouse are non-residents. You cannot duplicate expenses paid for by another student.


What can I claim?

You can claim other out of pocket expenses, provided you have documentation for each qualifying expense. Related expenses include student-activity fees and expenses for course-related books, supplies, and equipment are included in qualified education expenses only if the fees and expenses must be paid to the institution as a condition of enrollment or attendance.

If you pay qualified education expenses with certain tax-free funds, you cannot claim a credit for those amounts. You must reduce the qualified education expenses by the amount of any tax-free educational assistance and refund(s) you received.

Qualified education expenses do not include amounts paid for insurance, medical expenses (including student health fees), room and board, transportation, or similar personal, living, or family expenses.

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