SSDI lump sum caused AGI to be too high to claim AOTC credit for my dependent in college

Forum|Forum|2 years ago
January 30, 2024
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In 2022, I received SSDI in a lump sum. Because it was for 4 years back pay, it made my AGI higher than the allowed amount to claim the AOTC credit for my dependent in college. The lump sum was for 4 years of income, all which was immediately paid back to my long term disability company (I did not keep any of the money). It seems completely unfair that since it was not income I received in 2022, that we do not qualify for the AOTC for my dependent in college, yet form 8863 states if your AGI is over $180k (married filing jointly) stop here you do not qualify. This seems so wrong- is there anything I can do?

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Hal_Al

Employee

You may have a case where you need to get your taxes done professionally. There may be away around it, but it may take special handling that can't be done in TurboTax (TT).

Claiming the AOTC for 2022 will require an amended return. There's special tax calculations for SSDI lump sum payments. There's a choice between a special tax calculation and an itemized deduction when income is paid back. This my be a case of needing an explanation attached to your tax return, for a modified MAGI on form 8863.