8863
Education Credits (American Opportunity and Lifetime Learning Credits)
Form 8863 is how you claim the American opportunity credit and the lifetime learning credit. Both reduce your tax based on qualified education expenses paid to an eligible college, university or other postsecondary school.
You choose between the two credits for each student, and you cannot claim both for the same student in the same year. The American opportunity credit is larger and part of it can be refunded to you. The lifetime learning credit is nonrefundable.
The form starts with a separate Part III for each student. Those figures feed Part I for the American opportunity credit and Part II for the lifetime learning credit. The result goes onto Schedule 3 and your Form 1040.
Complete a separate Part III for each student before you do Parts I and II. It collects the student's information and the school's details, including the school's employer identification number for the American opportunity credit.
Line 1 pulls from each student's Part III, line 30. Up to $2,500 per eligible student is available, and 40% of it may be refundable.
Line 10 pulls from each student's Part III, line 31. The lifetime learning credit is 20% of up to $10,000 of expenses per return, a $2,000 maximum.
Line 19 uses the worksheet in the instructions and goes to Schedule 3 (Form 1040), line 3.
Line 23 asks whether the American opportunity credit was claimed for the student in four prior tax years.
The school sends Form 1098-T, and the instructions say it is generally required. Its box 1 amount may differ from what you actually paid.
The American opportunity credit needs a degree or recognized credential program and at least half-time enrollment. The lifetime learning credit does not.
Count only amounts paid in 2025, including payments for academic periods beginning in the first three months of 2026. Subtract tax-free assistance such as scholarships and any refunds.
Carry the student totals from Part III. Line 7 sets refundability limits for some students under age 24 whose parents were alive and who are not filing jointly.
Figure the final amount on line 19.
The instructions say that if you were denied or reduced the American opportunity credit for reasons other than a math or clerical error, you generally must attach Form 8862 the next time you claim it.
The refundable American opportunity credit goes on line 29 of Form 1040. You can fill this form online free on this page.
You get the real form, filled in a browser tab, with nothing standing between you and the finished PDF.
File Form 8863 with your income tax return by its due date.
Attach it to Form 1040. Tax software transmits it with an e-filed return.
The form is free from the IRS.
If a refund or tax-free assistance comes after you file, the instructions say you may need to recapture part of the credit.
Claiming both credits for the same student, using the wrong school information, counting expenses paid with tax-free aid, and not having a taxpayer identification number are the frequent problems.
1040
199 fields, 2 pages
1098-T
56 fields, 4 pages
8862
109 fields, 3 pages
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8880
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You can claim both on one return, but not for the same student in the same year.
The IRS gives up to $2,500 per eligible student, and 40% may be refundable.
It is 20% of up to $10,000 of expenses per return, a $2,000 maximum, and it is nonrefundable.
It is available for four tax years per student. The lifetime learning credit has no limit on years.
The instructions say Form 1098-T is generally required, with exceptions listed.
Subtract tax-free assistance, such as scholarships, from qualified expenses.
