The Lifetime Learning Credit is a tax credit available for taxpayers who pay college expenses.
This credit is similar to the American Opportunity Credit, but there are some key differences:
- Anyone who takes a college class, even part-time, can take the Lifetime Learning Credit. The credit is calculated as 20% of the first $10,000 of expenses (so a maximum credit of $2,000 is available). With the AOC, only students enrolled at least half-time, and in their first 4 years of college, can take the credit.
- The Lifetime Learning Credit is non-refundable, while the AOC is partially refundable.
- Certain expenses that count for the AOC don’t count for the Lifetime Learning Credit. For example, textbooks don’t count for the LLC unless it’s required that the student buy the textbook directly from the school.
For more definitions of tax terms, visit the Glossary page.