American Opportunity Credit - Turbo Tax says not qualified

Forum|Forum|5 years ago
April 16, 2021
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I have 2 kids in college. My son is in his 4th year, and I got the American Opportunity Credit for him. My daughter is in her first year of college. She did get scholarships, but I still paid ~$7,000 in tuition in 2020. I answered all the questions correctly, but TurboTax says she doesn't qualify.

One thing I noticed - for my son, I was able to insert "Amount used to calculate education credit or deduction". I used 4,000. But for my daughter, I didn't get that chance - that screen says "Earlier you told us to treat $0 as a taxable education distribution in order to claim a larger education tax credit or deduction. However, it's no longer beneficial for any amount to be treated as a taxable distribution and used for an education credit or deduction, so we'll just make this entry zero."

It seems that if I can figure out how to adjust this, I'll be able to get the Turbo Tax to say she's qualified for the credit.

Any advice?

Hal_Al

Employee

Delete you daughter's 1098-T and re-enter.

Go through the entire education interview until you reach a screen titled "Your Education Expenses Summary". Click delete next to the student's name. You'll then get the "Your Education Expenses Summary" screen again. Click the "Add a student" button. If box 1 of her 1098-T does not exceed box 5 by $4000 or more, you will not get the AOC for her, without adjusting your entries.

meyersmlAuthor

Original poster here.

I followed your advice and deleted and re-entered the 1098-T info, but same result. Still not getting the AOC even though the 1098-T Box 1 is $7,000 more than Box 5.

What mistake could I be making?