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substance as of the end of the
tax year.
2. Lifetime learning credit. A stu-
dent who is enrolled in one or more
courses at an eligible educational
institution.
3. Student loan interest deduc-
tion. A student who was enrolled
at least half-time in a program
leading to a postsecondary de-
gree, certificate, or other recog-
nized educational credential at an
eligible educational institution.
Half-time student: A student who is
enrolled for at least half the full-time
academic workload for the course of
study the student is pursuing, as deter-
mined under the standards of the
school where the student is enrolled.
Modified adjusted gross income
(MAGI):
1. American opportunity credit.
Adjusted gross income (AGI) as
figured on the federal income tax
return, modified by adding back
any:
•
Foreign earned income exclu-
sion,
•
Foreign housing exclusion,
•
Foreign housing deduction,
•
Exclusion of income by bona
fide residents of American Sa-
moa, and
•
Exclusion of income by bona
fide residents of Puerto Rico.
2. Coverdell education savings ac-
count (ESA). Same as American
opportunity credit in this category.
3. Education savings bond pro-
gram. AGI as figured on the fed-
eral income tax return without tak-
ing into account any savings bond
interest exclusion and modified by
adding back any:
•
Foreign earned income exclu-
sion,
•
Foreign housing exclusion,
•
Foreign housing deduction,
•
Exclusion of income by bona
fide residents of American Sa-
moa,
•
Exclusion of income by bona
fide residents of Puerto Rico,
•
Exclusion for adoption benefits
received under an employer's
adoption assistance program,
and
•
Deduction for student loan in-
terest.
4. Lifetime learning credit. Same
as American opportunity credit in
this category.
5. Student loan interest deduc-
tion. AGI as figured on the federal
income tax return without taking
into account any student loan inter-
est deduction, and modified by
adding back any:
•
Foreign earned income exclu-
sion,
•
Foreign housing exclusion,
•
Foreign housing deduction,
•
Exclusion of income by bona
fide residents of American Sa-
moa, and
•
Exclusion of income by bona
fide residents of Puerto Rico.
Phaseout: The amount of credit or
deduction allowed is reduced when the
MAGI is greater than a specified
amount of income.
Qualified education expenses: See
the pertinent chapter for specific items.
1. American opportunity credit.
Tuition and certain related expen-
ses (including student activity fees)
required for enrollment or attend-
ance at an eligible educational in-
stitution. Books, supplies, and
equipment needed for a course of
study are included even if not pur-
chased from the educational insti-
tution. Doesn't include expenses
for room and board. Doesn't in-
clude expenses for courses involv-
ing sports, games, or hobbies (in-
cluding noncredit courses) that
aren't part of the student's postse-
condary degree program.
2. Coverdell education savings ac-
count (ESA). Expenses related to
or required for enrollment or at-
tendance of the designated benefi-
ciary at an eligible elementary,
secondary, or postsecondary
school. Includes computer or pe-
ripheral equipment, computer soft-
ware, or Internet access and rela-
ted services. Many specialized
expenses included for K–12. Also
includes expenses for special
needs services and contributions
to a QTP.
3. Education savings bond pro-
gram. Tuition and fees required to
enroll at or attend an eligible edu-
cational institution. Also includes
contributions to a QTP or Coverdell
ESA. Doesn't include expenses for
room and board. Doesn't include
expenses for courses involving
sports, games, or hobbies that
aren't part of a degree or certifi-
cate-granting program.
4. IRA, early distributions from.
Tuition, fees, books, supplies, and
equipment required for enrollment
or attendance at an eligible educa-
tional institution, plus certain limi-
ted costs of room and board for
students who are enrolled at least
half-time. Also includes expenses
for special needs services incurred
by or for special needs students in
connection with their enrollment or
attendance.
5. Lifetime learning credit. Tuition
and certain related expenses re-
quired for enrollment or attend-
ance at an eligible educational in-
stitution. Student activity fees and
expenses for course-related
books, supplies, and equipment
are included only if the fees and
expenses must be paid to the insti-
tution as a condition of enrollment
or attendance. Doesn't include ex-
penses for room and board.
Doesn't include expenses for cour-
ses involving sports, games, or
hobbies (including noncredit cour-
ses) that aren't part of the stu-
dent's postsecondary degree pro-
gram, unless taken by the student
to acquire or improve job skills.
6. Qualified tuition program (QTP).
Tuition, fees, books, supplies, and
equipment required for enrollment
or attendance at an eligible higher
educational institution, plus certain
limited costs of room and board for
students who are enrolled at least
Publication 970 (2023) 75