I received the full $2,500 in previous years. I attended school full-time throughout the entire 2024 school year. I pay tuition costs out of pocket, no loans. My income was significantly reduced in 2024 because I could only work part-time. I am so confused; please provide any insight!
Only $1000 (40% of $2500) of the American Opportunity Credit (AOC) is refundable. The rest can only be used to offset (credit against) an actual tax liability. It sounds like it only took $423 to reduce you tax liability to zero. Look at lines 16 & 18 of form 1040. The non refundable portion of the AOC will be included in the line 20 amount (and shown on line 3 of Schedule 3). The $1000 refundable amount is on line 29.
Only $1000 (40% of $2500) of the American Opportunity Credit (AOC) is refundable. The rest can only be used to offset (credit against) an actual tax liability. It sounds like it only took $423 to reduce you tax liability to zero. Look at lines 16 & 18 of form 1040. The non refundable portion of the AOC will be included in the line 20 amount (and shown on line 3 of Schedule 3). The $1000 refundable amount is on line 29.