why I don't get AOTC credit?

Forum|Forum|6 years ago
March 5, 2020
2 replies
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I am a full-time student over age 18 and under age 24 at the end of 2019 and my earned income was less than one-half of my support for year 2019. My parent is not claiming me as dependent. I only used AOTC one time in Y2018. I allocated $2000 as education expense for AOTC purpose, rest of education expense is paid via 529 plan. My taxable income in Y2019 is zero after using standard deduction. Still, I should be getting 40% of AOTC credit amount refunded, which is $800. But Turbox tax says I don't qualify for AOTC. Why? My situation is almost same as last year when I qualified for AOTC, except my income is below standard deduction this year. Is this a bug in TurboTax?

Best answer by Bsch4477

The AOTC credit has 2 aspects--a non-refundable portion which is applied to tax due. You do not get that since you have no tax liability. The other portion is refundable--you get it whether you have a tax liability or not. However, there is a circumstance--like yours--in which the refundable portion cannot be claimed. If the student has a living parent, has earned income which is less than one half of his support and files as single--all of which fit your situation--that student cannot claim the refundable portion. See Pub 970, page 21 for a full discussion.

MinhT1

As you are under 24, a full time student and did not provide for more than half of your own support with your earned income, you can be claimed as a dependent by your parents. Even if they did not actually claim you, you are not eligible for the refundable part of the American Opportunity credit.

Please use this Interactive Tax Assistant to check your eligibility.

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