Lifetime Learning Credit

[mjy39307]

Son is in 4th year of graduate school, graduates May 2023.  In 2022, we paid tuition of over $75K; he earned $7.5K from a part time job during 2022.  We can't claim the credit because he isn't our dependent any longer because he made over $4.4K and is 25 years old.  He can't use the credit because he got all his tax paid in refunded and has no tax owed.  Is this just how it works?  Or am I misinterpreting something?  Your expert advice would be appreciated as this just doesn't seem right that we could pay that much and get no credit for it on ours or his return.

Michael

[xmasbaby0]

Sorry---yes, that is how it works.  Your son is too old to be claimed as a qualifying child dependent and made too much to be claimed as a qualified relative.   The Lifetime Learning Credit is not refundable, so if he has no tax liability, the credit does not do anything for him.  The LLC can only reduce your tax owed, and he does not owe any tax.

[mjy39307]

Really appreciate your quick response.  Even though I am an experienced accountant, I am not necessarily a tax expert.  It is reassuring to hear someone else with tax knowledge who knows what I'm talking about and confirms my assessment.

Thanks again!

Michael