There are several differences and some similarities between the American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit (LLC). You can claim these two benefits on the same return but not for the same student or the same qualified expenses. See "No Double Benefits Allowed" for more information on claiming one or more education benefits.
Tax Year 2023 Education Benefits Comparison
| Criteria | AOTC | LLC |
|---|---|---|
| Maximum benefit | Up to $2,500 credit per eligible student | Up to $2,000 credit per return |
| Refundable or nonrefundable | 40% of credit (refundable) | Not refundable |
| Limit on MAGI* for married filing jointly | $180,000 | $180,000 |
|
Limit on MAGI* for single, head of household, or qualifying widow(er) |
$90,000 | $90,000 |
| If married can you file a separate return? | No | |
| Dependent status | Cannot claim benefit if someone else can claim you as a dependent on their return | |
| Can you or your spouse be a nonresident alien? | No, unless nonresident alien is treated as resident alien for tax purposes (see Publication 519 for information on nonresident alien status) | |
| Number of years of post-secondary education available | Only if student hasn't completed 4 years of post-secondary education before 2023 | All years of post-secondary education and for courses to acquire or improve job skills |
| Number of tax years benefit available | 4 tax years per eligible student (includes any years former Hope credit claimed) | Unlimited |
| Type of program required | Student must be pursuing a degree or other recognized education credential | Student does not need to be pursuing a degree or other recognized education credential |
| Number of courses | Student must be enrolled at least half time for at least one academic period beginning in 2023 | Available for one or more courses |
| Felony drug conviction | Students must have no felony drug convictions as of the end of 2023 | Does not apply |
| Qualified expenses | Tuition, required enrollment fees and course materials needed for course of study | Tuition and fees required for enrollment or attendance |
| For whom can you claim the benefit? |
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| Who must pay the qualified expenses? |
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| Payments for academic periods |
Made in 2023 for academic periods beginning in 2023 or the first 3 months of 2024
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| Do I need to claim the benefit on a schedule or form? |
Yes, Schedule 3 of Form 1040 PDFand Form 8863, Education Credits PDF |
Yes, Schedule 3 of Form 1040 PDF and Form 8863, Education Credits PDF |
ˆ Third Party-Qualified education expenses paid by a third party for you or a student you claimed as a dependent on your return are considered paid by you for the AOTC and LLC. Payments by third parties include amounts paid by relatives or friends.
* MAGI, modified adjusted gross income: For most people, MAGI is the amount of AGI, adjusted gross income, shown on your tax return. If you file Form 1040 or Form 1040SR, AGI is on line 8b and you add back the following:
- Foreign earned income exclusion,
- Foreign housing exclusion,
- Foreign housing deduction,
- Exclusion of income by bona fide residents of American Samoa, and
- Exclusion of income by bona fide residents of Puerto Rico.
If you need to adjust your AGI to find your MAGI, there are worksheets in the Publication 970 PDF to help you.
Education Benefits Resources
- Education Credits
- What You Need to Know about AOTC and LLC
- Education Credit Products
- Tax Benefits for Education: Information Center
- Publication 970, Tax Benefits for Education PDF
- Department of Education website