Your American Opportunity credit is 40% refundable. That means a portion of the credit will be refunded to you even if you don't owe any federal income tax.
The remaining $1,500 ($2,500 x 60%) is a nonrefundable credit that provides a benefit to you only if you owe federal income taxes.
The non-refundable part will show on schedule 3 Additional Credits and Payments line 8 and is included in the amount reported on form 1040 line 20.
To get to the education section to see if you qualify for the credit:
- Go to Federal Taxes,
- Go to Deductions and Credits.
- Scroll down to Education and click show more.
- Scroll down to Expenses and Scholarships (Form 1098-T) and click Revisit.
Please check the link below for AOC eligibility
Who is eligible to take the American Opportunity Tax Credit?
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