Form 1040/Form 8863, American Opportunity and Lifetime Learning Credits
Lifetime Learning Credits
, as mandated by the Taxpayer
For example, both the Hope and Lifetime Learning Credits
are nonrefundable, so the resulting benefits cannot exceed taxes owed.
Both the American Opportunity and Lifetime Learning credits
are available through 2012 to offset college costs.
D Plans Educational S: 71,100-86,100 n/a Savings Bonds J: 106,650-136,650 (([section]) 135) A--American Opportunity Credit (AOTC) and Lifetime Learning Credits
are not available if Education Expense (([section]) 222) deduction is taken.
The personal credits--which consist of the child and dependent care credit (5ci); the credit for the elderly and the permanently and totally disabled (6ci); the qualified adoption credit; (7ci); the nonrefundable portion of the child tax credit (8ci); the Hope Scholarship and Lifetime Learning credits
(9ci) (see Q 7546); the credit for elective deferrals and IRA contributions (the "saver's credit," which became permanent under PPA 2006 (10ci));
28) This exclusion can also be used with either the Hope or lifetime learning credits
(see the discussion on p.
The nonrefundable credits are as follows: (1) the personal credits - such as the child and dependent care credit; (8) the credit for the elderly and the permanently and totally disabled (9)--see Q 833), the qualified adoption credit, (10) the Hope Scholarship and Lifetime Learning Credits
(11)--see Q 835); the credit for elective deferrals and IRA contributions (the "saver's credit" (12) (which became permanent under PPA 200613); the credit for certain non-business energy property--that is, energy efficient improvements to existing homes (expires December 31, 2007, but is then allowed for property placed in service in 2009) (1); the credit for residential energy efficient property; (2) (2) other non-business credits; and (3) the general business credit.
Back in 1997, the federal Taxpayer Relief Act provided for the Hope Scholarship and Lifetime Learning Credits
as a means of opening the doors of college to a new generation, with the largest investment in higher education since the 1956 G.
Planning Point--Taxpayers may not allocate qualified tuition and related expenses to the Hope Scholarship and Lifetime Learning Credits
for the same student in the same tax year.
1 HOPE SCHOLARSHIP CREDIT LIFETIME LEARNING CREDIT
Limit $2,500 (in 2009 and 2010) $2,000 (in 2009) Covers First two (four in 2009 Unlimited number of years and 2010) years of post- secondary education AGI Phaseout S: $80,000-90,000 (in S: $50,000-60,000 (in Offsets 2009 and 2010) 2009) J: $160,000-180,000 (in J: $100,000-120,000 (in 2009 and 2010) 2009) A--Hope Scholarship and Lifetime Learning Credits
are not available if the education expense deduction is taken.
He said new tax credits will be available to more families than the previous Hope and Lifetime Learning credits
, which were capped at a family income of $114,000 per year.