How to Claim the Lifetime Learning Credit for College Tuition

Introduction

The Lifetime Learning Credit (LLC) is a valuable education tax credit that helps taxpayers reduce the
cost of higher education. Under IRC § 25A, the LLC provides a credit of up to $2,000 per tax return
for tuition and course-related expenses. Unlike the American Opportunity Credit (AOC), the LLC is
available for both undergraduate and graduate students and has no limit on the number of years it
can be claimed.

This guide explains who qualifies, what expenses are eligible, and how to claim the Lifetime
Learning Credit in 2025.

Who Qualifies for the Lifetime Learning Credit?

To be eligible, you must meet the following criteria:

•  You, your spouse, or a dependent student must be enrolled in at least one course at an eligible educational institution.
•  The education must be for job skills improvement, a degree, or certification.
•  Your Modified Adjusted Gross Income (MAGI) must be below the IRS limit.
•  You must pay qualified education expenses out-of-pocket.

2025 Income Limits for the LLC

Important:

• If you are Married Filing Separately, you cannot claim the credit.
•  Unlike the AOC, you can claim the LLC for unlimited years.

How Much Is the Lifetime Learning Credit Worth?

•  The maximum credit is 20% of the first $10,000 in tuition and course-related expenses.
•  The maximum annual credit per return is $2,000.
•  The LLC is non-refundable, meaning it can reduce your tax bill to zero but will not generate
  a refund.

What Expenses Qualify for the LLC?

Eligible Expenses

•  Tuition and enrollment fees
•  Books and required course materials (if paid directly to the school)
•  Graduate and professional education costs
•  Vocational and job training programs

Non-Eligible Expenses

•  Room and board
•  Transportation costs
•  Student activity fees
•  Course materials not required by the school

How to Claim the Lifetime Learning Credit

Step 1: Gather Required Documents

•  Form 1098-T (Tuition Statement from the school)
•  Receipts for tuition, books, and fees

Step 2: Complete IRS Forms

•  Form 8863 – Education Credits
•  Form 1040, Line 3 of Schedule 3 – Report the credit amount

Step 3: File Your Tax Return

•  If your tax liability is zero, you cannot receive a refund from the LLC, but it can reduce the
  amount you owe.

IRS Forms & Compliance Checklist

•  Form 1040 – Main tax return
•  Form 8863 – Required to claim the credit
•  Form 1098-T – Tuition statement from school

Conclusion

The Lifetime Learning Credit (LLC) is a great way to lower your tax bill while investing in education.
Since it applies to graduate programs and job training, it is ideal for working professionals and
lifelong learners.

For expert tax assistance, schedule a consultation with Anshul Goyal, CPA EA FCA, a licensed tax
professional and IRS representative.

Frequently Asked Questions (FAQs)

1. Can I claim both the Lifetime Learning Credit and the American Opportunity Credit?
No, you must choose one per student per tax year.

2. Can I claim the LLC if I’m a part-time student?
Yes, as long as you take at least one course at an eligible institution.

3. Can I claim the LLC if I pay tuition with student loans?
Yes, as long as you are legally responsible for repaying the loan.

4. Can parents claim the LLC for their children?
Yes, if they claim the student as a dependent on their tax return.

5. Is the LLC available if I take the standard deduction?
Yes, you can claim the LLC whether you itemize or take the standard deduction.

About Our CPA

Anshul Goyal, CPA EA FCA is a licensed Certified Public Accountant and an IRS Enrolled Agent (EA).
He specializes in education tax credits, IRS compliance, and tax-saving strategies.

Schedule a consultation today with Anshul Goyal, CPA, to maximize your tax benefits.