The Lifetime Learning Credit is a non-refundable tax
credit that could reduce federal income taxes for taxpayers by up to 20 percent of the
first $5,000 out-of-pocket qualified tuition and fees paid for all eligible students in a
taxpayer's family.
A taxpayer paying qualified tuition and fees at a
postsecondary educational institution may claim the credit. Students are not required to
take more than one course and both undergraduate and graduate level qualified tuition fees
from eligible institutions can be included.
The Lifetime Learning Credit applies to expenses paid
starting July 1, 1998 for education in academic periods beginning after that date.
Only tuition and enrollment fees for courses taken at
eligible institutions are included---not books, housing costs, or other living expenses.
The amount of qualified tuition and fees is reduced by
certain grant and scholarship aid. Other reductions may apply.
Yes. A taxpayer may not take both a Hope Scholarship
Tax Credit and Lifetime Learning Credit for the educational expenses of the same student.
The per taxpayer credit limit per year for the Lifetime Learning Credit is $1,000 (20% of
the first $5,000 of expenses for all eligible students in the taxpayer's family). The tax
credit phases out for joint taxpayers with income between $50,000 and $100,000. See the
IRS web site for additional requirements.
Eligible taxpayers will claim the credit when they file
their 1999 federal income tax forms in 2000.
