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Why my tax return decrease when I answer yes to “did the student complete the firts 4 years of post secondary education?
I am getting master degree, but last year I was doing the same.
Like I was getting some money back, then after I answer yes for that question, I have to pay lol. It doesn’t make sense
7 Answers
- ?Lv 72 weeks ago
Grad students are not eligible for the AOC education credit. When you check that box, it changed to the Lifetime Learning Credit which is less.
- Anonymous2 weeks ago
Ok I get this but it wasn’t claimed before. Like a question before says has the hope scholarship credit or American opportunity credit been claimed for this student for any 4 tax years? It is No all
Others tax years
- Anonymous2 weeks ago
The software stupidly showed you a possible tax refund based on being eligible for the American Opportunity Credit. When you indicated you weren't eligible, it switched the refund to the Lifetime Learning Credit which is not as generous. If the software had *not* shown you anything until you answered all of the questions, you wouldn't have felt cheated.
The AOC isn't intended for master's degrees. See IRS publication 970 for more information.
- A HunchLv 72 weeks ago
Yes, it makes sense.
The American Opportunity Tax Credit is only available for individuals in their first 4 years of higher education.