About the Education Tax Credit Calculator (AOTC/LLC)
This calculator estimates the two federal education credits for college costs: the American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit (LLC). Enter your filing status, modified adjusted gross income, the number of students eligible for the AOTC and their qualified expenses, plus any expenses for courses that qualify only for the LLC, and it applies the Form 8863 rules — including the income phase-out and the 40% refundable part of the AOTC.
The AOTC is worth up to $2,500 per eligible student — 100% of the first $2,000 of tuition, fees and course materials and 25% of the next $2,000 — for the first four years of undergraduate study, at least half-time. The LLC is 20% of up to $10,000 of qualified expenses per return (maximum $2,000) and covers graduate school, professional courses and job-skills classes with no limit on years. Both phase out between $80,000 and $90,000 of MAGI ($160,000–$180,000 if married filing jointly); these limits are fixed by law and not indexed, and married couples filing separately cannot claim either credit.
Parents of undergraduates, graduate students and adults taking classes can use it to see which credit applies and roughly how much it reduces their tax. You cannot claim both credits for the same student in the same year, and expenses paid with tax-free scholarships, Pell grants or 529 withdrawals do not count. From 2026 the One Big Beautiful Bill Act requires the Social Security number of each student whose expenses you claim to be on the return for either credit, and the AOTC also needs the school’s EIN.
With the default inputs, the total education credits is $2,500.00. Change any value above to recalculate instantly.
How to use the education tax credit calculator (aotc/llc)
- 1Choose your filing status and enter your modified adjusted gross income.
- 2Enter how many students qualify for the American Opportunity Credit and their qualified expenses each.
- 3Add expenses for graduate, professional or other courses that qualify only for the Lifetime Learning Credit.
- 4Enter your federal tax before credits to see how much of the non-refundable part you can use.
- 5Read the total credit, the refundable amount and any reduction from the phase-out.
Formula and method
The AOTC is figured per eligible student: every dollar of the first $2,000 of qualified expenses counts in full and a quarter of the next $2,000 counts, so $4,000 of expenses earns the $2,500 maximum. The LLC is 20% of up to $10,000 of qualified expenses for all students on the return, so it tops out at $2,000 no matter how many students you have.
Both credits are multiplied by the Form 8863 phase-out fraction: ($90,000 − MAGI) ÷ $10,000 for single and head-of-household filers, or ($180,000 − MAGI) ÷ $20,000 for joint filers, capped between 0 and 1 and rounded to three decimals. Forty percent of the allowed AOTC is refundable. The rest of the AOTC and the LLC are non-refundable and can only reduce your tax to zero, so the calculator limits them to your tax before credits. The refundable part is not available if you are under 24 and meet the kiddie-tax tests; that case is not modelled.
- E
- Qualified expenses for one AOTC student
- MAGI
- AGI plus excluded foreign earned income and housing amounts
- L, W
- Phase-out end and width: $90,000/$10,000, or $180,000/$20,000 for joint filers
Worked examples
Married couple with one college freshman
With $6,000 of tuition the student earns the full $2,500 AOTC ($2,000 + 25% of the next $2,000). MAGI of $120,000 is below the $160,000 joint phase-out start, so the whole credit is allowed; $1,000 of it is refundable.
Single parent inside the phase-out with two students
Two students would earn $5,000, but MAGI of $85,000 is halfway through the $80,000–$90,000 range, so the fraction is ($90,000 − $85,000) ÷ $10,000 = 0.5 and the credit is $2,500, of which $1,000 is refundable.
Graduate student using the Lifetime Learning Credit
The LLC is 20% of the first $10,000 of expenses, so $14,000 of graduate tuition produces the $2,000 maximum. MAGI of $60,000 is below the phase-out and the $5,000 tax bill absorbs the full non-refundable credit.
Low tax bill limits the non-refundable part
The full $2,500 AOTC is allowed, but only the $1,000 refundable part is paid regardless of tax. The $1,500 non-refundable part can only wipe out the $600 tax bill, so $900 is lost and the benefit is $1,600.
Frequently asked questions
How much is the American Opportunity Tax Credit?+
Up to $2,500 per eligible student per year: 100% of the first $2,000 of qualified tuition, fees and course materials plus 25% of the next $2,000. Up to 40% ($1,000) is refundable, and it can be claimed for no more than four tax years per student.
What are the income limits for education credits?+
Both the AOTC and the LLC phase out between $80,000 and $90,000 of modified AGI for single and head-of-household filers and between $160,000 and $180,000 for married couples filing jointly. Married filing separately cannot claim either credit.
Can I claim both the AOTC and the Lifetime Learning Credit?+
Not for the same student in the same year. You can claim the AOTC for one student and the LLC for another student on the same return, and the AOTC is almost always the larger credit when a student qualifies for both.
What expenses qualify for education credits?+
Tuition and fees required for enrolment. For the AOTC, books, supplies and equipment needed for a course also count even if bought elsewhere. Room and board, insurance, transportation and personal expenses do not qualify for either credit.
Do scholarships reduce my education credit?+
Yes. You must subtract tax-free scholarships, Pell grants, employer-provided educational assistance and tax-free 529 or Coverdell distributions used for the same expenses. Sometimes it pays to treat part of a scholarship as taxable income to free up expenses for the AOTC.
Who claims the credit — the parent or the student?+
Whoever claims the student as a dependent claims the credit, even if the student paid the tuition. If no one can claim the student, the student claims it on their own return. You need Form 1098-T from the school.
Tax results are estimates based on published rules and simplified assumptions. They are not tax advice — check official guidance or a tax professional for your situation.