AnnetteB6
Employee Tax Expert

Education

You may have qualified for the full $2500 in American Opportunity Tax Credit, but the circumstances on your tax return are keeping you from getting the full benefit.  There is nothing you can do to change that if you have reported all of your income.  

 

As stated earlier, the total $2500 credit is made up of two pieces.  One piece worth $1500 can be used to 'pay' the income tax on your return.  If your income tax is less than $1500, then you will not be able to use all $1500 of that part of the education credit.  The leftover part is unused and cannot be added to your refund.  It just disappears.  That's what it means to be 'non-refundable'.

 

The other piece worth $1000 can be added to your refund.  That is 'refundable'.  You are receiving the full benefit of that part of the education credit.  

 

When you say other students in a similar situation to you are getting the full amount, that may be true, but the main difference has to do with the income and income tax on the return and not the education expenses themselves.  

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