Hello! I am trying to switch my education deduction from the Lifetime Learning Credit ($69) to the Tuition Deduction ($346), but the system won't allow me.

Forum|Forum|5 years ago
January 29, 2021
1 reply
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I want to switch which credit I am getting, but Turbotax is convinced the Lifetime Learning Credit is best, even though it isn't as much money for the credit.

TurboTax Deluxe Online

MinhT1

In this case, TurboTax may be right.

The Lifetime learning credit is equal to 20% of your education expenses of $346, which is $69. The credit of $69 directly reduces your tax liability by $69.

The tuition deduction is a deduction which reduces your taxable income, and not your tax liability dollar for dollar. The deduction reduces your tax liability by $346 multiplied by your marginal tax rate.

If your marginal tax rate is lower than 20%, then it is more beneficial for you to take the Lifetime Learning credit. And TurboTax has already made that calculation for you.

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