My Tax Aide colleague who worked in a university financial aid office for years and is the local expert on this stuff would say that you need to check with the school that will award your daughter her college degree this year. If they treat her as having completed four years of post-secondary education this year, then your last year to claim AOTC would be this year.My situation:
1. My daughter is in her third year of college and plans to graduate this year.
2. Helping her graduate in 3 years were credits she earned during a gap year program after high-school (maybe earned 20-30 credits that year and was able to use some of those credits toward her degree as elective credits).
3. Current plan: as the 3 years of school cover 4 tax years, was planning on using the AOTC tax credits for those tax years.
4. She plans to go to nursing school next year for a year (school year 2025-2026).
5. My income was a little higher this year and we wouldn't be able to get the full AOTC credit in 2024 (although not that far off).
Question:
If we don't take the AOTC in 2024 (perhaps will use the Hope tax credit to get a little back), could she use the AOTC credit in year 2026 where she will be in Nursing school?
Concerns I'm not sure about it:
a) She will have a completed degree in 2025. I don't think that matters, but not sure.
b) One of the stipulations for AOTC is "has not completed the first four years of post-secondary education as of the beginning of the taxable year". Does the gap year count?
Her opinion is that it is the determination of the degree granting institution that matters. In my mind, "completing four years of post-secondary education" is equivalent to "completed their senior year" which, if she's getting a four year degree, she has sort of by definition done. I don't think it matters if some of those credits were done in high school, or via AP/CLEP, or testing out, or taking 7 calendar years to complete - the year you finish your senior year of college, that's the last AOTC tax year.
Statistics: Posted by secondcor521 — Tue Sep 10, 2024 10:54 pm — Replies 12 — Views 718