I found an article that explains why he's getting the $2,500. The entire credit transfers to non-refundable and the amount he is allowed is based on his tax liability, which is $3,575 for 2024. Therefore, he qualifies to receive the entire $2,500 as a non-refundable credit. Thus making his refund $2,957 since $4,032 was withheld from his paychecks.
https://ttlc.intuit.com/community/college-education/discussion/turbo-tax-is-calculating-all-of-my-am...
My current issue is New Jersey state taxes and whether I can claim him as a dependent even though I am not claiming him on federal. I am qualified to claim him on federal but will not so he can claim the AOTC. New Jersey's wording doesn't say a dependent is who you claimed on federal, but rather who you were qualified to claim on federal.
