Educational Tax Benefits

American Opportunity Tax Credit (AOTC)

The American Opportunity Tax Credit is a tax credit for qualified students to have some or all of their educational expenses subsidized. Eligible students may obtain a credit for up to $2,500 annually. This credit can only be claimed for four tax and academic years.

AOTC Eligibility Requirements

Your modified adjusted gross income (MAGI) must be less than $80,000 ($160,000 for a joint return) to qualify for this deduction in its entirety.*

Your AOTC will be reduced over time if your MAGI is over $80,000 but less than 90,000 (over $160,000 but less than $180,000 for a joint return).*

AOTC will not be granted to those with a MAGI of $90,000+ ($180,000+ for a joint filing).*

In order to be eligible for the AOTC, UChicago students must be degree-seeking, enrolled in at least two courses in one or more quarters within the current tax year, not have completed four academic years by the tax year's beginning, and have not claimed an AOTC credit for more than four tax years.

Qualified Educational Expenses at UChicago include tuition, course fees, study abroad program fees, and the student life fee. All other fees are not considered qualified expenses.

You must file a federal income tax return and have some income tax liability to get the credit. If you are claimed as a dependent on someone’s tax return, only the person who claims you can receive the credit.

If you claim the American Opportunity credit for one or more students in your family, you can’t use their expenses to claim the Lifetime Learning Credit.

*Amounts shown for the 2023 tax year. This is updated yearly by the IRS.

Lifetime Learning Credit (LLC)

The Lifetime Learning Credit is a tax credit for qualified students to have some or all of their educational expenses subsidized. Eligible students may obtain a credit for up to $2,000 annually. There is no limit to the number of years that this credit can be claimed, and you can be studying for any level of degree to qualify.

LLC Eligibility Requirements

Your modified adjusted gross income (MAGI) must be less than $90,000 ($180,000 for a joint return) to qualify for this deduction.*

Your LLC will be reduced over time if your MAGI is between $80,000-$90,000 ($160,000-$180,000 for a joint return).*

In order to be eligible for the LLC, UChicago students must be taking classes (not necessarily degree-seeking) and enrolled in at least one quarter within the current tax year.

You cannot claim this deduction if you are married and file separately or if another person can claim you as a dependent on his or her tax return.

*Amounts shown for the 2023 tax year. This is updated yearly by the IRS.

AOTC vs. LLC

Not sure which tax credit works best for you? The IRS website has a comparison chart where you can decide which of the two tax credits most apply to your situation.

Student Loan Interest Deduction

The Student Loan Interest Deduction allows you to deduct interest paid on student loans for yourself, your spouse, or your dependents. It can reduce your taxable income by as much as $2,500. The amount of the Student Loan Interest Deduction you are eligible for depends on the amount of interest paid and your income. It is an adjustment to your income so you can claim this deduction even if you do not itemize deductions on Schedule A of Form 1040.

Student Loan Interest Deduction Calculator

Not sure if you can claim this deduction? Use this calculator from this IRS to determine your eligibility.