Why does TurboTax separate American Opportunity Credit and Education Credit? My $2500 Amer Op credit is split to $1500 education credit and $1000 American Op credit?

Forum|Forum|4 years ago
April 14, 2022
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Wife had over $4k in tuition in form 1098-T. I'm filling out form 8863 and should have $2500 American Opportunity Credit. However Turbotax shows $1500 education credit and $1000 American Opportunity Credit. Wouldn't the IRS think this is wrong since my form 8863 will say $2500 American Opportunity Credit?

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Best answer by Vanessa A

It is breaking down your AOTC into the refundable and nonrefundable portions. If you look at form 8863, you will see line 19 shows $1,500 and line 8 shows $1,000. On form 8863, Part II is Nonrefundable Education Credits, Part I is Refundable American Opportunity Credit. Basically, TurboTax is doing a graph using the words on the form. This graph is not sent to the IRS only the form 8863.

Vanessa A

Where do you see this? Are you sure you are not seeing $1,000 as a refundable credit and $1,500 as the non refundable part? You can only get one education credit per person, but the AOTC can be split between refundable and non refundable.

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Dolphins89Author

Thanks for replying! I click on the Federal Refund (in progress) link at the top, then go to Your Taxes, then Credits, and it shows there. Is there a better way to see the breakdown? I just want to make sure it's sent to the IRS correctly. My wife has over $4k tuition in the 1098-T, and filling out form 8863 gives me $2500 just for American Opportunity credit. I have to attach it when submitting so it looks strange to send to the IRS like this.