Lifetime Learning Credit
Encyclopedia
The Lifetime Learning Credit, provided by , is available to taxpayers who have incurred education expenses. For this credit to be claimed by a taxpayer, the student must attend school on at least a part-time basis. The credit can be claimed for education expenses incurred by the taxpayer, the taxpayer’s spouse, or the taxpayer’s dependent.
This credit allows for a 20% tax credit for first $10,000 of qualified tuition and expenses to be fully creditable against the taxpayer’s total tax liability. The maximum amount of the credit is $2000 per eligible student. The credit is available for net tuition and fees (less grant aid) paid for post-secondary enrollment. The credit is available on a per-taxpayer (family) basis, and is phased out at the same income levels as the Hope Scholarship Credit
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and a Lifetime Learning Credit for the same student in the same year. The credit is subject to a limitation designed to reserve the benefit to low to moderate income taxpayers. The credit amount is phased out gradually once a taxpayer’s gross income exceeds $47,000, and the credit is phased out entirely once a taxpayer’s gross income exceeds $57,000. These numbers are increased for taxpayers who file jointly to $94,000 and $114,000 respectively.
This credit allows for a 20% tax credit for first $10,000 of qualified tuition and expenses to be fully creditable against the taxpayer’s total tax liability. The maximum amount of the credit is $2000 per eligible student. The credit is available for net tuition and fees (less grant aid) paid for post-secondary enrollment. The credit is available on a per-taxpayer (family) basis, and is phased out at the same income levels as the Hope Scholarship Credit
Hope Scholarship Credit
The Hope credit, provided by , is available to taxpayers who have incurred expenses related to the first two years of postsecondary education. For this credit to be claimed by a taxpayer, the student must attend school on at least a part-time basis...
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Qualifying expenses
“Qualified tuition and related expenses” is defined as “the tuition and fees paid at most colleges and universities for the enrollment or attendance of the taxpayer, the taxpayer’s spouse, or any dependent of the taxpayer. These qualifying expenses do not include student activity fees, athletic fees, insurance costs, or room and board expenses.Limitations
The Lifetime Learning Credit is subject to some limitations. A taxpayer may not take both a Hope creditHope Credit
The United States federal HOPE Tax credit is a nonrefundable education tax credit of up to $1,800 for each eligible student. Students in a qualified Midwestern disaster area may receive up to $3,600...
and a Lifetime Learning Credit for the same student in the same year. The credit is subject to a limitation designed to reserve the benefit to low to moderate income taxpayers. The credit amount is phased out gradually once a taxpayer’s gross income exceeds $47,000, and the credit is phased out entirely once a taxpayer’s gross income exceeds $57,000. These numbers are increased for taxpayers who file jointly to $94,000 and $114,000 respectively.