American Opportunity Credit

[strickb16]

My daughter took dual enrollment courses during her senior year of high school.  I received a 1098-T.  Turbo Tax has me qualified for the American Opportunity Credit, however wouldn't I want to wait and use that for the next four years that she is at a University?  I thought you were limited on the number of times you could use the American Opportunity Credit? 

[rjs · Accepted solution]

Yes, you can only use the American Opportunity Credit 4 times for a particular student. You can probably select one of the other education benefits this year, so you can save the American Opportunity Credit for when it will have more value. In the Search box type the word letme (just like that, with no space), then click the link that says "Jump to letme." It will ask you if you want to change your education credit or deduction. Click Yes. On the next screen click Continue. On the next screen you can select the education credit or deduction that you want to take.

[Carl]

using the LETME option, I would suggest you select to take the Lifetime Learning Credit (LLC). While the AOTC has a maximum credit of $2,500 the LLC is maxed at $2000. I seriously doubt as a duel enrolled student, that your student comes anywhere close to qualifying you for the full $2000. Since there's no limit on the number of times you can take the LLC, that's why I recommend you chose that one.

Also, for the AOTC limited to 4 years, keep this in mind. Colleges work in academic years, while the IRS works in calendar years. So the reality is, it takes you five calendar years to get the four year degree. With that said, your student will start their fourth and final college year in their fourth calendar year. But the final semester of that fourth college year will start in the fifth calendar year. So you want to pay for that final semester ***BEFORE*** the end of the fourth calendar year so you can take the highest advantage of the AOTC in that fourth calendar year.