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Department of the Treasury Internal Revenue Service Publication 970 Cat. No. 25221V Tax Benefits for Education For use in preparing 2022 Returns Get forms and other information faster and easier at: • IRS.gov (English) • IRS.gov/Spanish (Español) • IRS.gov/Chinese (中文) • IRS.gov/Korean (한국어) • IRS.gov/Russian (Pусский) • IRS.gov/Vietnamese (Tiếng Việt) Contents Future Developments . . . . . . . . . . . . . . . . . . . . . . . 2 What's New . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Reminders . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 Chapter 1. Scholarships, Fellowship Grants, Grants, and Tuition Reductions . . . . . . . . . . . . 5 Scholarships and Fellowship Grants . . . . . . . . . . 5 Other Types of Educational Assistance . . . . . . . . 7 Chapter 2. American Opportunity Credit . . . . . . . 9 Can You Claim the Credit? . . . . . . . . . . . . . . . . 11 What Expenses Qualify? . . . . . . . . . . . . . . . . . . 12 Who Is an Eligible Student? . . . . . . . . . . . . . . . . 18 Who Can Claim a Dependent's Expenses? . . . . . 19 Figuring the Credit . . . . . . . . . . . . . . . . . . . . . . 20 Claiming the Credit . . . . . . . . . . . . . . . . . . . . . . 22 Chapter 3. Lifetime Learning Credit . . . . . . . . . . 22 Can You Claim the Credit? . . . . . . . . . . . . . . . . 23 What Expenses Qualify? . . . . . . . . . . . . . . . . . 24 Who Is an Eligible Student? . . . . . . . . . . . . . . . 29 Who Can Claim a Dependent's Expenses? . . . . 29 Figuring the Credit . . . . . . . . . . . . . . . . . . . . . . 29 Claiming the Credit . . . . . . . . . . . . . . . . . . . . . . 31 Chapter 4. Student Loan Interest Deduction . . . 31 Student Loan Interest Defined . . . . . . . . . . . . . . 31 Can You Claim the Deduction? . . . . . . . . . . . . . 34 Figuring the Deduction . . . . . . . . . . . . . . . . . . . 35 Claiming the Deduction . . . . . . . . . . . . . . . . . . . 36 Chapter 5. Student Loan Cancellations and Repayment Assistance . . . . . . . . . . . . . . . . . 37 Loan for Postsecondary Educational Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 Student Loan Repayment Assistance . . . . . . . . . 38 Chapter 6. Coverdell Education Savings Account (ESA) . . . . . . . . . . . . . . . . . . . . . . . . 38 What Is a Coverdell ESA? . . . . . . . . . . . . . . . . . 39 Contributions . . . . . . . . . . . . . . . . . . . . . . . . . . 40 Rollovers and Other Transfers . . . . . . . . . . . . . . 43 Distributions . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 Chapter 7. Qualified Tuition Program (QTP) . . . . 50 What Is a QTP? . . . . . . . . . . . . . . . . . . . . . . . . 50 How Much Can You Contribute? . . . . . . . . . . . . 51 Recontribution of Refunded Amounts . . . . . . . . . 51 Are Distributions Taxable? . . . . . . . . . . . . . . . . 51 Rollovers and Other Transfers . . . . . . . . . . . . . . 53 Chapter 8. Education Exception to Additional Tax on Early IRA Distributions . . . . . . . . . . . . 54 Who Is Eligible? . . . . . . . . . . . . . . . . . . . . . . . . 54 Jan 20, 2023