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February 20, 2024
Question

It is trying to give my dependant student both education credits and i think your only allowed one?

  • February 20, 2024
  • 1 reply
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1 reply

DaveF1006
February 20, 2024

It depends. You can only receive either the Lifetime Credit or the American Opportunity Credit up to a maximum of $2500 but not both.  

 

I think what you may be referring to is that you are receiving the American Opportunity Credit and there is a non-refundable portion of the credit being applied as well as a refundable credit. This is referred to as a partially refundable tax credit. 

 

With the AOC, up to 40 percent of the credit is refundable and counted as a tax payment. When you claim this credit for education expenses, Form 8863 separately calculates the refundable and nonrefundable portions. For example, if you calculate a $2,500 American Opportunity credit, a maximum of $1000 may be reported as a refundable tax credit with the remaining $1,500 reported as a nonrefundable credit.

 

If this doesn't fit your situation, please write back and let us know specifically on why you think your dependent is receiving both credits.

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