Question

In 2019, Laureen is currently single. She paid $2,800 of qualified tuition and related expenses for each of her twin daughters Sheri and Meri to attend State University as freshmen ($2,800 each for a total of $5,600). Sheri and Meri qualify as Laureen’s dependents. Laureen also paid $1,900 for her son Ryan’s (also Laureen’s dependent) tuition and related expenses to attend his junior year at State University. Finally, Laureen paid $1,200 for herself to attend seminars at a community college to help her improve her job skills.

Laureen’s AGI is $45,000 and Laureen paid $12,000 (not $1,900) for Ryan to attend graduate school (i.e., his fifth year, not his junior year).

American Tax Opportunity Credit?

Lifetime Learning Credit?

Answer 1

a.
Twins - 2000*2+(800*2*25%)	$ 4,400
Ryan	$ 1,900
The American opportunity tax credit	$ 6,300
Lifetime Learning Credit (1200*20%)	$    240
b.
Twins - 2000*2+(800*2*25%)	$ 4,400
Ryan - 2000+(2000*25%)	$ 2,500
The American opportunity tax credit	$ 6,900
Lifetime Learning Credit (1200*20%)	$    240

The American opportunity tax credit is 100% of the first $2,000 of qualified education expenses and 25% of the next $2,000. Total of $2,500

Lifetime Learning Credit is 20% of the first $10,000 of qualified education expenses or a maximum of $2,000 per return.