Comparison of Education Tax Credits and Deductions
| American Opportunity credit | Lifetime Learning credit | Student loan interest deduction | Deduction for qualified higher education expenses | |
| Credit/deduction applies to | Qualified tuition and related expenses for first four years of undergraduate education | Qualified tuition and related expenses for courses taken throughout lifetime to improve or acquire job skills | Interest paid on a qualified student loan | Qualified higher education expenses paid during the year |
| Qualified education expenses include room and board? | No | No | Yes | No |
| Maximum credit/deduction | $2,500 | $2,000 | $2,500 | $4,000 (full) $2,000 (partial) |
| Income limits in 2016 | Single filers: full credit available if modified adjusted gross income (MAGI) $80,000 or less
Partial credit available if MAGI between $80,000 and $90,000 Joint filers: full credit available if MAGI $160,000 or less Partial credit available if MAGI between $160,000 and $180,000 |
Single filers: full credit available if modified adjusted gross income (MAGI) $55,000 or less
Partial credit available if MAGI between $55,000 and $65,000 Joint filers: full credit available if MAGI $111,000 or less Partial credit available if MAGI between $111,000 and $131,000 |
Single filers: full deduction available if modified adjusted gross income (MAGI) $65,000 or less
Partial deduction available if MAGI between $65,000 and $80,000 Joint filers: full deduction available if MAGI $130,000 or less Partial deduction available if MAGI between $130,000 and $160,000 |
Single filers: $4,000 (full) deduction available if modified adjusted gross income (MAGI) $65,000 or less
$2,000 (partial) deduction available if MAGI between $65,000 and $85,000 Joint filers: $4,000 (full) deduction available if MAGI $130,000 or less $2,000 (partial) deduction available if MAGI between $130,000 and $160,000 |
| Less than half-time students or graduate students eligible? | No | Yes | Less than half-time – no; graduate students – yes | Yes |
| Limit on number of students in family for whom credit/deduction can be taken in same year? | No | Yes; annual credit is limited to $2,000 per tax return | No; if applicable, parents can claim the deduction for more than one child in the same year | No; if applicable, parents can claim the deduction for more than one child in the same year |
| Credit/deduction available in same year as tax-free distribution from a Coverdell education savings account? | Yes | Yes | Yes | Yes, but qualifying expenses are reduced by Coverdell ESA distributions; also deduction is not available in a tax year in which the American Opportunity credit or Lifetime Learning credit is taken for the same student |
| Must student be enrolled for a degree or in other program leading to an educational credential? | Yes | No | No | No |
| Allowed if student has a controlled substance conviction? | No | Yes | Yes | Yes |
