8863 form -how AOC works LIne 7

 

🔢 How is that calculated?

Here’s how AOC works:

• You get 100% of the first $2,000 of education expenses = $2,000

• Then 25% of the next $2,000 = up to $500 more

• So the maximum total credit is $2,500 per student

But in this case, maybe the person:

• Had low education expenses (like only a few hundred dollars)

• Or only qualified partially (maybe they only went to school part of the year)

• Or their income was too high and the credit was phased out

So after the math, their credit came out to $55 total.