Why doesn’t my daughter qualify for the American Opportunity Credit? Is it because she’s in Cosmotology school? They accept Federal Aid.

Forum|Forum|1 year ago
January 28, 2025
2 replies
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She seems to meet all criteria

xmasbaby0

Employee

To see if a school is eligible to take education credits

Enter your school at the link below, to see if it's on the dept. of education list.

https://ope.ed.gov/dapip/#/home

**Disclaimer: Every effort has been made to offer the most correct information possible. The poster disclaims any legal responsibility for the accuracy of the information that is contained in this post.**

Hal_Al

Employee

Q. Why doesn’t my daughter qualify for the American Opportunity Credit? Is it because she’s in Cosmetology school?

A. No. Cosmetology school, as well as other vocational training, counts.

There's a new urban myth among college students that says they can get a $1000 from the government just for filing a tax form. For most of them, they simply aren't eligible. A full time unmarried student, under age 24, even if you don't qualify as a dependent, is only eligible for the refundable portion of the American Opportunity Credit if he supports himself by working.* You cannot be supporting yourself on parental support, 529 plans or student loans & grants. It is usually best if the parent claims that credit.

You cannot claim the (up to) $1000 refundable credit if you are, or can be, claimed as a dependent by someone else.

If she is 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

Does she qualify as your dependent?

Is she actually being claimed as your dependent?

Are you trying to claim the American Opportunity Credit (AOC) or is she trying to claim it on her return?

What is her age?

What is her student status: fulltime, half time or more, less than half time? The school defines status.

Does completion of the course result in a certificate or credential (you must answer yes to that question in the TurboTax interview)?

*Reference: Line 7 instructions for form 8863.

https://www.irs.gov/instructions/i8863#en_US_2024_publink53002gd0e674

snlong86Author

She’s 18

Full Time in program

Started school September, 2024

She is claimed as my dependent

She hasn’t filed any returns

My AGI at Head of Household is well under the limit

…my turbo tax is saying the best return for my situation is around 1k for the lifetime learning credit but it seems like we should qualify for the max Educational Opportunity Credit.

…perhaps I need to revisit my answers?

Hal_Al

Employee

Q. perhaps I need to revisit my answers?

A. Everything you describe says you qualify.

Try deleting and re-entering. Go through the entire education interview until you reach a screen titled "Your Education Expenses Summary". Click delete next to the student's name (you cannot change it and you cannot save your entered info). After you confirm your deletion, the next screen will allow you to add a student.

Did you did get a 1098-T? If not, after answering no to "did you receive a 1098-T", answer yes to the question "do you qualify for an exception".

Did the school tell you why they did not issue a 1098-T? If they are on the DOE approved list, they should be issuing that form.