topic American Opportunity Credit in Education

American Opportunity Credit

krameb — Mon, 07 Feb 2022 00:56:17 GMT

How does the American Opportunity Credit is calculated in Turbotax?

I entered the 1098-T for my two daughters but only got a $205 refund for each.

Is there a proportional calculation done?

Re: American Opportunity Credit

Hal_Al — Mon, 07 Feb 2022 01:11:53 GMT

The AOC is 100% of the first $2000 of tuition paid and 25% of the next $2000. $2500 maximum. It is 40% refundable ($1000 max). That is, you get part of it even if you have no tax liability. See the calculations on form 8863.

Re: American Opportunity Credit

krameb — Mon, 07 Feb 2022 01:24:44 GMT

Thank you. Understood! :(

Re: American Opportunity Credit

LoganathanB — Mon, 07 Feb 2022 01:31:13 GMT

Two factors can reduce your credit.

Modified Adjusted Gross Income
Your Tax Liability

Click on the link for more information

American Opportunity Tax Credit