When my son is not a student, my daughter's LLC is $2000. When my son is a student, my daughter's LLC is $1,400 and my son's is $600..

Forum|Forum|10 months ago
May 27, 2025
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When my son is not a student, my daughter's LLC is $2,000.

When my son is a student, my daughter's LLC is $1,400 and my son's is $600.

When my son is a student, why did my daughter's LLC not stay at $2,000?

Thanks!

PS... I think this is my last question for my 2022 joint return.

@Hal_Al

Best answer by rjs

Sorry. @Hal_Al was mistaken in your other thread, and I didn't catch the error. According to IRS Publication 970, page 23, the maximum Lifetime Learning Credit is $2,000 per return. You are getting the maximum credit.

Letting the children claim the credit could possibly allow them to each get up to the $2,000 maximum. But their tax liability (Form 1040 line 18) might not be high enough for them to get the maximum credit. Also, as discussed in the other thread, there are other drawbacks to letting them claim the credit. It's probably better overall to leave it the way it is.

rjs

Employee

Are those the exact amounts?

What are the exact amounts on your Form 1040 lines 18 through 22?

As Hal_Al suggested in one of your other threads, it sounds like your tax liability might not be large enough for you to get the maximum Lifetime Learning Credit. If Form 1040 line 22 is zero you cannot get any more credit. It doesn't matter how you allocate it between the two children. There is no way that you can make the total credit any higher. It has already reduced your tax to zero.

Please do not post any more separate questions about your problems with the Lifetime Learning Credit. When information is scattered in multiple threads it's confusing and hard to follow, and hard to see the whole picture.

QRFMTOAAuthor

Are those the exact amounts?

Alice's LLC: $1,406

Nate's LLC: $594

What are the exact amounts on your Form 1040 lines 18 through 22?

18: $10,336

19: $1,000

20: $2,000

21: $3,000

22: $7,336

There is no way that you can make the total credit any higher. It has already reduced your tax to zero.

Sorry!

Thanks, again, for all your help!

QRFMTOAAuthor

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Hal_Al

Employee

My reply at the other thread was incorrect and has been edited. The LLC is $2000 max per tax return, unlike the AOC which is $2500 max per student.

While technically there is a provision that allows your student-dependent to claim a federal tuition credit, on his own tax return, from a practical matter it seldom works out. A full time student, under age 24, is only eligible for the refundable portion of the American Opportunity Credit (AOTC) if he/she supports himself by working. She cannot be supporting herself on student loans & grants and 529 plans and parental support. It is usually best if the parent claims that credit.

If the student actually has a tax liability, there is a provision to allow him to claim a non-refundable tuition credit. But then the parent must forgo claiming the student as a dependent, and the $500 other dependent credit. The student must still indicate that he *can be* claimed as a dependent, on his return. This is worth up to $2500 (AOTC shifts to all non refundable) or $2000 if the student is only eligible for the Lifetime Learning Credit (LLC).