Lifetime Learning Credit

You may be able to claim a lifetime learning credit of up to $2,000 for qualified education expenses paid for all students enrolled in eligible educational institutions. There is no limit on the number of years the lifetime learning credit can be claimed for each student.

A tax credit reduces the amount of income tax you may have to pay. Unlike a deduction which reduces the amount of income subject to tax, a credit directly reduces the tax itself. The lifetime learning credit is a nonrefundable credit, which means that it can reduce your tax to zero, but if the credit is more than your tax, the excess will not be refunded to you.

If you are eligible to claim the lifetime learning credit and you are also eligible to claim the Hope credit for the same student in the same year, you can choose to claim either credit, but not both. For 2005, if the total qualified education expenses for a student are more than $7,500, it will generally be to your benefit to claim the lifetime learning credit.

Click here for more information about the Lifetime Learning Credit.