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Comparison of Education Credits for 2021 Caution. You can claim both the American opportunity credit and the lifetime learning credit on the same return, but not for the same student. American Opportunity Credit Lifetime Learning Credit Maximum credit Up to $2,500 credit per eligible student Up to $2,000 credit per return Limit on modified adjusted gross income (MAGI) $180,000 if married filing jointly; $90,000 if single, head of household, or qualifying widow(er) $180,000 if married filing jointly; $90,000 if single, head of household, or qualifying widow(er) Refundable or nonrefundable 40% of credit may be refundable; the rest is nonrefundable Nonrefundable—credit limited to the amount of tax you must pay on your taxable income Number of years of postsecondary education Available ONLY if the student had not completed the first 4 years of postsecondary education before 2021 Available for all years of postsecondary education and for courses to acquire or improve job skills Number of tax years credit available Available ONLY for 4 tax years per eligible student Available for an unlimited number of tax years Type of program required Student must be pursuing a program leading to a degree or other recognized education credential Student doesn't need to be pursuing a program leading to 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 during 2021 (or the first 3 months of 2022 if the qualified expenses were paid in 2021) Available for one or more courses Felony drug conviction As of the end of 2021, the student had not been convicted of a felony for possessing or distributing a controlled substance Felony drug convictions don't make the student ineligible Qualified expenses Tuition, required enrollment fees, and course materials that the student needs for a course of study whether or not the materials are bought at the educational institution as a condition of enrollment or attendance Tuition and required enrollment fees (including amounts required to be paid to the institution for course-related books, supplies, and equipment) Payments for academic periods Payments made in 2021 for academic periods beginning in 2021 or beginning in the first 3 months of 2022 TIN needed by filing due date Filers and students must have been issued a TIN by the due date of their 2021 return (including extensions) Educational institution's EIN You must provide the educational institution's employer identification number (EIN) on your Form 8863 Table 1. Who Can Claim an Education Credit You may be able to claim an education credit if you, your spouse, or a dependent you claim on your tax return was a student enrolled at or attending an eligible educational institution. For 2021, the credits are based on the amount of adjusted qualified education expenses paid for the student in 2021 for academic periods beginning in 2021 or beginning in the first 3 months of 2022. Academic period. An academic period is any quarter, semester, trimester, or any other period of study as reasonably determined by an eligible educational institution. If an eligible educational institution uses credit hours or clock hours and doesn't have academic terms, each payment period may be treated as an academic period. For details, see Academic period in chapters 2 and 3 of Pub. 970. Who can claim a dependent's expenses. If a student is claimed as a dependent on another person's tax return, all qualified education expenses of the student are treated as having been paid by that person. Therefore, only that person can claim an education credit for the student. If a student isn't claimed as a dependent on another person's tax return, only the student can claim the credit. Expenses paid by a third party. Qualified education expenses paid on behalf of the student by someone other than the student (such as a relative) are treated as paid by the student. However, qualified education expenses paid (or treated as paid) by a student who is claimed as a dependent on your tax return are treated as paid by you. Therefore, you're treated as having paid expenses that were paid by the third party. For more information and an example, see Who Can Claim a Dependent's Expenses in Pub. 970, chapters 2 and 3. Who cannot claim a credit. You cannot claim an education credit on a 2021 tax return if any of the following apply. 1. You're claimed as a dependent on another person's tax return, such as your parent's return. 2. Your filing status is married filing separately. 3. You (or your spouse) were a nonresident alien for any part of 2021 and didn't elect to be treated as a resident alien for tax purposes. 4. Your MAGI is $180,000 or more if married filing jointly; or $90,000 or more if single, head of household, or qualifying widow(er) with dependent child. 5. The student has not been issued a TIN by the due date of their 2021 return (including extensions). Generally, your MAGI is the amount on your Form 1040 or 1040-SR, line 11. However, if you're filing Form 2555, Foreign Earned Income; or Form 4563, Exclusion of Income for Bona Fide Residents of American Samoa; or are excluding income -2- Instructions for Form 8863 (2021)