LLC (Lifetime Learning Credit)
The Lifetime Learning Credit (LLC) is a tax credit designed to assist individuals in paying for qualified tuition and related expenses for higher education. This credit can be used for undergraduate, graduate, and professional degree courses, as well as courses aimed at acquiring or improving job skills. Unlike some other education credits, there is no limit on the number of years you can claim the LLC. The LLC is worth up to $2,000 per tax return.
Who can claim the LLC?
To be eligible to claim the LLC, you must meet all three of the following criteria:
- You, your dependent, or a third party must have paid qualified education expenses for higher education.
- The education expenses must have been paid for an eligible student who is enrolled at an eligible educational institution.
- The eligible student can be yourself, your spouse, or a dependent listed on your tax return.
Please refer to the "Who Cannot Claim an Education Credit" section on our Education Credits - AOTC and LLC page for more information.
Interactive education credit app
To determine if you are eligible to claim an education credit, you can use our interactive app called "Am I Eligible to Claim an Education Credit?".
Who is an eligible student for LLC?
To be considered an eligible student for the LLC, the individual must:
- Be enrolled or taking courses at an eligible educational institution.
- Be pursuing higher education courses to obtain a degree, recognized education credential, or to acquire or improve job skills.
- Be enrolled for at least one academic period that begins in the tax year. Academic periods can include semesters, trimesters, quarters, or any other period of study, such as a summer school session. The specific academic periods are determined by the school. In cases where schools use clock or credit hours instead of academic terms, the payment period may be treated as an academic period.
Important differences between LLC and AOTC
It is important to note that there are significant differences between the LLC and the American Opportunity Tax Credit (AOTC). For a detailed comparison, please refer to our chart on comparing the LLC and AOTC.
What are the income limits for LLC?
For the tax year 2023, the LLC amount is gradually reduced (phased out) if your Modified Adjusted Gross Income (MAGI) falls between $80,000 and $90,000 ($160,000 and $180,000 for joint filers). You cannot claim the LLC if your MAGI is $90,000 or more ($180,000 or more for joint filers).
Claiming the credit
To be eligible to claim the AOTC or LLC, the law requires taxpayers (or their dependents) to have received Form 1098-T, Tuition Statement, from an eligible educational institution, whether domestic or foreign. Generally, students receive this form from their school by January 31st. The information provided on Form 1098-T helps determine the amount of credit you can claim. However, please note that the amount shown in Box 1 of Form 1098-T may not necessarily be the amount you can claim. For more information on qualified education expenses and how to determine the correct amount to claim, please refer to the relevant resources.
It is important to review your Form 1098-T for accuracy. If there are any discrepancies or if you do not receive the form, please contact your school.
To claim the LLC, you must complete Form 8863 and attach it to your Form 1040 or Form 1040-SR.
What is the LLC worth?
The LLC is worth 20 percent of the first $10,000 of qualified education expenses, with a maximum credit of $2,000 per tax return. It is important to note that the LLC is not refundable. This means that while you can use the credit to offset any tax you owe, you will not receive any excess credit amount as a refund.
For more information and resources on education credits, please refer to the Education Credits section.