What is American Opportunity credit? Also, it asked for in all tuition including loans and grants so I put that in and then it asked for Grants, but not loans?

choir18 — Thu, 06 Jun 2019 13:38:20 GMT

TurboTax will ask for all of the information contained in...

KennethB — Thu, 06 Jun 2019 13:38:21 GMT

TurboTax will ask for all of the information contained in your Form 1098-T, as well as information for:

-"Other Scholarships/Grants/Fellowships"

-"Veterans Education Benefits or certain Indian Tribal Payments"

-"Employer-Provided Assistance"

Per the TurboTax On Demand Tax Guidance:

What is the American Opportunity Credit?

The American Opportunity Credit provides up to $2,500 for each eligible student per year. It can be claimed for the first four years of post-secondary education.

The term "qualified tuition and related expenses" includes expenditures for "course materials." For this purpose, the term "course materials" means books, supplies, and equipment needed for a course of study whether or not the materials are purchased from the educational institution as a condition of enrollment or attendance.

Forty percent of this is a refundable credit, which means that you can receive up to $1,000 even if you owe no taxes. However, none of the credit is refundable if the taxpayer claiming the credit is a child (a) who is under age 18 (or a student who is at least age 18 and under age 24 and whose earned income does not exceed one-half of his or her own support), (b) who has at least one living parent, and (c) who does not file a joint return.

Do I qualify for the American Opportunity Credit?

Eligibility requirements

- The student must be you, your spouse, or a child whom you claim as a dependent on your tax return.

- The credit can only be claimed for the first four years of post-secondary education.

- The student must be pursuing a degree, certificate, or other recognized credential at an Eligible Educational Institution.

- The credit is only available for four tax years.

- The student must be enrolled at least half-time for a minimum of one academic period during the tax year.

- The academic period must begin either during 2017 or during the first three months of 2018.

- You must pay the expenses during 2017.

- You can pay expenses with a loan, including low-interest student and government subsidized loans, but be sure to deduct the expenses rather than the loan payments.

- Qualified education expenses include tuition and "course materials." For this purpose, the term "course materials" means books, supplies, and equipment needed for a course of study whether or not the materials are purchased from the educational institution as a condition of enrollment or attendance.

- Courses must be taken at an eligible educational institution. Check with your school to see if they are eligible to participate in a student aid program administered by the Department of Education.

Limitations of this credit

- You cannot claim this credit if you are claimed as a dependent on someone else's return

- If you are married, you do not qualify if your filing status is married filing separately.

Your modified adjusted gross income should be less than $90,000 or $180,000 for married filing joint.

- You cannot take the American Opportunity Credit for expenses you paid if you claimed them for the Lifetime Learning Credit, Tuition and Fees Deduction, or job-related expenses.

- You cannot claim expenses that you paid with tax-free money from an education savings account (ESA) or qualified tuition program (QTP), such as a Section 529 Plan. When you take a distribution from an ESA or a QTP, part of it is from your original contribution and part of it is from earnings on the account. You cannot claim expenses paid with the tax-free earnings, but you can claim expenses paid with money from your original contribution.

- You cannot claim expenses that you paid with a tax-free scholarship, fellowship, grant, or employer tuition assistance. If you paid taxes on the tuition assistance (the tuition assistance appears on your W-2), you can claim the expenses.

- You cannot deduct meals, lodging, insurance, transportation, or other personal expenses

- You cannot deduct courses for sports, games, hobbies, or non-credit courses (unless they are part of the student's degree program).

- The student must not have a felony drug conviction as of the end of 2017.

Special circumstances or exceptions

- If one parent claims the child as a dependent and the other pays the education expenses, the parent who claims the student as a dependent also claims the credit.

- If the student withdraws from the classes, you can still claim the expenses if they were not refunded when the student withdrew.

- If expenses were paid with a loan, including low-interest student and government subsidized loans, you can still deduct them. Be sure to deduct the expenses rather than the loan payments.

- Students can claim eligible education credits when their parents don't claim them as a dependent. However, the student must have enough taxable income and resulting income tax to be able to deduct the credit from his or her taxes due.

What paperwork do I need for the American Opportunity Credit?

For your records, you'll need to keep the following:

- Form 1098-T, Tuition Payments Statement. Educational institutions issue this form.

- Any canceled checks or receipts that show your payment for the qualifying expenses.

- Any other documentation showing enrollment status and tuition and fees paid.

Deductions and credits related to the American Opportunity Credit

- Lifetime Learning Credit

- Tuition and Fees Deduction

- The Hope Credit is no longer available

- Student Loan Interest Paid Deduction

topic What is American Opportunity credit? Also, it asked for in all tuition including loans and grants so I put that in and then it asked for Grants, but not loans? in Education

What is American Opportunity credit? Also, it asked for in all tuition including loans and grants so I put that in and then it asked for Grants, but not loans?

TurboTax will ask for all of the information contained in...