American Opportunity Tax Credit

[Brent]

I attended college full time from Jan - May 2016 when I graduated. I paid about $12,000 for tuition and also received about $12,000 in grants. But I had to make my tuition payment in December 2015 for the Spring 2016 semester. Can I still claim this tax credit even though I made the payment in 2015 but it was for the 2016 school year?

[Patrice]

It doesn't matter when the tuition was billed or what the 1098-T says. What matters is when was the tuition was actually PAID. If the spring 2017 tuition was paid in 2016, it was deductible (or counted toward the education credit) in 2016.

For example: If it wasn't paid until 2017, it gets reported on your 2017 tax return. That's one of the purposes of a December billing, to give the taxpayer the option of paying in 2016 or 2017.