Tuition and fees deduction
The tuition and fees deduction is a taxable income deduction of up to $4,000 on your tax return. Like all deductions, the amount it can reduce your taxes depends on multiple factors such as your income and filing status. Deductions reduce your taxable income.
The American Opportunity Tax Credit (AOTC) is a credit on your tax return of up to $2,500 per eligible student. Like all credits, the AOTC can reduce the amount of tax you owe. It is a refundable credit, which meansif claiming the AOTC reduces your tax obligation to zero, you can get 40 percent of any remaining amount of the credit (up to $1,000) back as a refund.
The Lifetime Learning Credit (LLC)
The Lifetime Learning Credit (LLC) is a credit on your tax return of up to $2,000. You may be eligible for this credit, which can lower the amount of tax you owe, if you paid for qualified tuition and enrollment fees and an eligible educational institution.To claim the full credit, your modified adjusted gross income (MAGI) must be $65,000 or less ($131,000 or less for married, filing jointly.).
You can’t double-dip these educational credits. If you claim the LLC for an eligible student, you can’t also claim the AOTC for that student.