Lifetime Learning Tax Credit

You may be able to claim a federal individual income Lifetime Learning Tax Credit of up to $2,000 for qualified tuition and related expenses per family. The Lifetime Learning Tax Credit reduces the amount of federal individual income taxes you may have to pay.

Income Limits

The amount of your Lifetime Learning Tax Credit is phased out (gradually reduced) if your modified adjusted gross income is between:

• $47,000 and $57,000 if you file as a single taxpayer, or
• $94,000 and $114,000 if you file a joint tax return.

You cannot claim a Lifetime Learning Tax Credit if your modified gross income is $57,000 or more ($117,000 or more if you file a joint return).

Eligibility

Generally, you can claim the Lifetime Learning Tax Credit if you pay qualified tuition and related expenses of higher education for an eligible student who is either yourself, your spouse, or a dependent for whom you claim an exemption. There is no limit on the number of years for which the Lifetime Learning Tax Credit can be claimed for each student. You cannot claim the Lifetime Learning Tax Credit if your tax filing status is married filing separate return.

Qualified Expenses

Qualified tuition and related expenses are tuition and fees required for enrollment or attendance at an eligible education institution. You must reduce the qualified expenses by the amount of any tax-free educational assistance you received. Non-credit courses to acquire or improve job skills also may qualify. Check with your tax preparer or contact the IRS.

Eligible Educational Institutions

Eligible educational institutions are any college, university, vocational school, or other postsecondary educational institution eligible to participate in student aid programs administered by the United States Department of Education.

Compatibility with Other Tax Benefits for Higher Education

You may be able to claim a Lifetime Learning Tax Credit in the same year in which you received a distribution from either a Coverdell Education Savings Account (ESA) or a Qualified Tuition Program (QTP), but you cannot use expenses paid with a distribution from either a Coverdell ESA or a QTP as the basis for the Lifetime Learning Tax Credit. You cannot claim the American Opportunity and Lifetime Learning Tax Credits for the same student in the same year.

Tax Form

To calculate Lifetime Learning Tax Credit, use Internal Revenue Service Form 8863.

For additional information on the Lifetime Learning Tax Credit, see Internal Revenue Service Publication 970.