AOTC

 The maximum American Opportunity Tax Credit (AOTC) you can claim is $2,500 per eligible student per year. This credit is designed to help offset the cost of higher education expenses.​IRS+5H&R Block Tax preparation company+5TurboTax+5

💰 How the AOTC is Calculated

• 100% of the first $2,000 of qualified education expenses, plus

• 25% of the next $2,000 of qualified expenses​IRS+4H&R Block Tax preparation company+4TurboTax+4

So, if you spend $4,000 or more on qualified education expenses, you can receive the full $2,500 credit.​IRS+8H&R Block Tax preparation company+8Investopedia+8

🔁 Refundable Portion

Up to 40% of the AOTC is refundable, meaning you could receive up to $1,000 as a refund even if you owe no tax. The remaining 60% can reduce any tax you owe to zero but won't result in a refund. ​IRS+2TurboTax+2Investopedia+2

👤 Eligibility Criteria

To qualify for the AOTC, the student must:

• Be pursuing a degree or recognized education credential

• Be enrolled at least half-time for at least one academic period during the tax year

• Not have completed the first four years of higher education at the beginning of the tax year

• Not have claimed the AOTC for more than four tax years

• Not have a felony drug conviction at the end of the tax year ​TurboTax+9IRS+9IRS+9

💵 Income Limits

The AOTC is subject to income limits:​

• Single filers: Credit phases out between $80,000 and $90,000 of modified adjusted gross income (MAGI)

• Married filing jointly: Credit phases out between $160,000 and $180,000 of MAGI​IRS+4Investopedia+4TurboTax+4TurboTax

Taxpayers with MAGI above these ranges are not eligible for the credit. ​Investopedia