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alan21
Level 2

Is a Computer a Qualified Expense for AOTC

Publication 970 says, "equipment needed for a course of study" is a qualified expense.  Not sure if schools technically "require" a laptop, but I don't see how any college student can get by without one with so much schoolwork being submitted online.  A laptop definitely seems "needed" to survive college today.  Does anybody have any insight on how the IRS views this today and whether a laptop (very much needed) can be claimed as a qualified expense for the American Opportunity Tax Credit?  Thanks.

 

 

2 Replies
Hal_Al
Level 15

Is a Computer a Qualified Expense for AOTC

You're not going to get a clear cut answer. 

The IRS says:  "Whether an expenditure for a computer qualifies for the credit depends on the facts. An expenditure for a computer would qualify for the credit if the computer is needed as a condition of enrollment or attendance at the educational institution". 

 https://www.irs.gov/newsroom/american-opportunity-tax-credit-questions-and-answers

 

Apparently, the tax court has ruled on this. 

https://www.currentfederaltaxdevelopments.com/blog/2016/8/25/purchase-of-computer-from-local-retaile...

The Tax Court concluded that the cost of a computer is not eligible for the AOTC unless the school requires the student to have one.

Some have translated this to:  The IRS has indicated a computer does qualify if it is needed for attendance at the educational institution. Generally, in this day and age, a computer is necessary ("required").

 

Be assured: "everybody is doing it". 

DaveF1006
Expert Alumni

Is a Computer a Qualified Expense for AOTC

Yes, a laptop is a qualified expense for the American Opportunity Credit because no student can complete their coursework without it.

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