What counts as 4 years of postsecondary education?

[Superglue27]

I enrolled in a four year program fall 2017, I took a gap year from fall 2018 to spring 2019. I later withdrew fall 2020. By time, I was enrolled for 4 years 2017-2020. But I've only accrued 35 credits and my old school considers me a sophomore. I've never filled for the American opportunity tax credit but would like to know if I am eligible. I'm currently taking classes at my local community college.

[xmasbaby0]

The "four years" is not as important as the fact that you are still a student working on earning an undergraduate degree.   If you have not used the American Opportunity Tax Credit you may be able to use it.  You can use the credit up to four times while earning an undergrad degree.    You do not say if someone else can claim you as a dependent.   If someone else can claim you, then the credit goes on their tax return.   If someone claimed you as a dependent during those early years when you were in school, you will want to find out if they used the credit then, because the "four times" goes with you as the student, no matter whether the credit was used by a parent or by yourself.

https://ttlc.intuit.com/questions/3262983-who-is-eligible-to-take-the-american-opportunity-tax-credi...

[Superglue27]

Okay, thank you! My parent claimed me as a dependent when I was a freshman. Since then, I've been filing independently without the credit. Sounds like I should have 3 more times to use it.

[rjs]

Whether you have completed 4 years of postsecondary education is determined by the school. IRS Publication 970 says "A student has completed the first 4 years of postsecondary education if the institution at which the student is enrolled awards the student 4 years of academic credit." Since you have only 35 credits, and the school considers you a sophomore, you have not completed 4 years of postsecondary education.

[rjs]

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@Superglue27 wrote:

My parent claimed me as a dependent when I was a freshman. Since then, I've been filing independently without the credit. Sounds like I should have 3 more times to use it.

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Ask your parent whether they claimed the American Opportunity Credit for your freshman year. It doesn't matter right now, but in a few years it might be useful to know exactly how many years the credit has been claimed for you.

[NCperson]

@Superglue27 

If you answer "yes" to ALL THREE questions you are not eligible for the refundable portion of the AOTC credit.

1) are you under 24 and providing less than 50% of your own support.

2) is at least one of your parents alive? 

3) is your filing status other than Married- Filing Joint? 

Further, you must be at least a half time student to be eligible for the credit.  Look at Form 1098-T as issued by your college.  Did they check the "more than half time" box on the form? 

Even if not eligible for AOTC, you would be eligible for the Lifetime Learning Credit.