There are two main credits for higher education expenses. You generally can only claim one per student per year.
| Feature | American Opportunity Tax Credit (AOTC) | Lifetime Learning Credit (LLC) |
| Best For | Undergraduates seeking a degree | Grad students, professional degrees, or skill improvement |
| Max Credit | Up to $2,500 per student | Up to $2,000 per tax return |
| Refundable? | Yes, up to $1,000 (40%) is refundable | No, non-refundable |
| Limit | First 4 years of post-secondary education | No limit on number of years |
| Expenses | Tuition, fees, and required course materials (books/supplies) | Tuition and fees only (books only if paid directly to the school) |
Tip: You must receive Form 1098-T from the school to claim either credit.
Official IRS Resource: Education credits: American Opportunity Tax Credit (AOTC) and Lifetime Learning Credit (LLC)
