It’s no secret that higher education costs are growing each year, and student loan debt is at an all-time high. In fact, it recently topped out at $1.75 trillion.
To help offset these costs, some taxpayers are taking advantage of the Lifetime Learning Credit (LLC).
What is a Lifetime Learning Credit (LLC)?
A Lifetime Learning Credit (LLC) is a tax credit for eligible students that offsets the cost of college tuition and school-related expenses. The tax credit helps cover the costs of earning a degree or learning a new skill with your current career.
This credit is worth up to $2,000 per tax year, and there is no limit to how many years you claim the credit. It’s important to note that an LLC is nonrefundable —you can use it only to pay taxes you owe — not for a tax refund.
Who is Eligible for a Lifetime Learning Credit (LLC)?
To be eligible for a Lifetime Learning Credit, students must:
- Be enrolled in or be taking classes at an eligible educational institution.
- Be enrolled for at least one academic period beginning in the tax year.
- Be taking higher education courses to get a degree or other recognized education credential to improve job skills.
- Modified Adjusted Gross Income (MAGI) of less than $69,000 or $138,000 if married.
You, your spouse, or even a dependent child listed on your tax return are eligible for the credit.
How to Claim a Lifetime Learning Credit
Once complete, you’ll attach Form 8863 to your federal tax return before sending it to the IRS.
There you have it! Now it’s time to see how you can use this unique tax credit to your advantage. Learn more about paying for college at withfrank.org.