I claimed the AOTC twice while paying for my daughter’s undergrad costs, in 2019 and 2020. She started grad school in 2024, and is paying the costs out of pocket with some assistance from an employer reimbursement program. She paid $8000 in 2024, but was reimbursed $4000 in January 2025.
After entering her information in the educational credit section, TT only brought up the Lifetime Learning credit. My understanding is that the AOTC can be claimed up to 4 times, but I don't know if this applies to undergrad only.
So, should she be eligible to claim the AOTC as a grad student? If not, is this because a new claim would not be consecutive? If she should be eligible, how should she enter her information to access some or all of the AOTC?
Thank you
You cannot use the AOTC for graduate school. That is a credit for only the first four years of undergraduate school---before achieving a bachelor's degree. A grad student can use the Lifetime Learning credit--which is non-refundable but which can reduce tax owed.
LIFETIME LEARNING CREDIT
https://ttlc.intuit.com/questions/3262984-who-is-eligible-for-the-lifetime-learning-credit
No, your daughter wouldn't qualify for the American Opportunity Tax Credit as a graduate school student. The credit is available for the first four years of college only.
Please see the IRS site for more explanation on who qualifies for the American Opportunity Tax Credit.
The AOTC is not available to grad students (or their parents). There is one exception: if the student did not finish his/her BS/BS until 2024 (e,g. he graduated in May 2024), and then started grad school in the fall, then both the grad and under grad expenses count for the AOTC. The technicality is that the student had not finish four years of post secondary education prior to 1-1-24.
https://www.irs.gov/credits-deductions/individuals/education-credits-questions-and-answers Scroll down to Q.9.