Lifetime Learning Credit

Forum|Forum|11 months ago
April 14, 2025
2 replies
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Turbotax is stating I'm not eligible for this credit but I can answer no to all of the bullets it's saying that may be reasons why I'm not eligible. My 1098-T has an amount in box 5 that is less than box 1, I make about $61k/year, no one else claims me as a dependent. Right now it is telling me I owe $259, but someone else is telling me I should be getting a refund of $948 based on the same info?

AmyC

Employee

The lifetime learning credit uses $10k to get the full credit. Let's see how much we can get.

Step 1 - scholarships - were they restricted for use in paying tuition or could they be used however you needed.

If restricted, remove those funds from the eligible scholarships.
If not restricted, excellent.

Step 2 -How much tuition is in box 1

If less than $10,000 we want to use it all and make the scholarships go 100% toward room and board.
If more than 10,000, scholarships can cover the amount over $10,000 and the rest to room and board.

For example: 1098-T box 1 is $15,000, box 5 17,000

Need $10k for LLC

Tuition is $15,000 - 10k for LLC is $5k to be covered by scholarships.

Scholarships are $17k and use $5k on tuition. This leaves $12k to go towards room and board.

You get the full LLC.

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Hal_Al

Employee

The LLC is non-refundable. That is, it can only be used to offset an actual tax liability on line 18 of form 1040.

If you are eligible, you have answered something wrong, in the interview. But, a lot of people are just not eligible. See Also see this TT support article https://turbotax.intuit.com/tax-tips/college-and-education/what-are-education-tax-credits/L7TuLrVqZ

https://ttlc.intuit.com/turbotax-support/en-us/help-article/tax-credits-deductions/education-tax-credits-available/L691dvlGB_US_en_US

https://www.irs.gov/credits-deductions/individuals/education-credits-questions-and-answers

https://www.irs.gov/individuals/llc