LLC (Lifetime Learning Credit)
A non-refundable tax credit of up to $2,000 per tax return for qualified tuition and education expenses.
The Lifetime Learning Credit (LLC) provides up to $2,000 per tax return (not per student) for qualified tuition and related expenses. It equals 20% of the first $10,000 in qualified expenses. Unlike the AOTC, there is no limit on the number of years you can claim it, and the student does not need to be pursuing a degree or be enrolled half-time. The credit is non-refundable. It phases out for single filers with MAGI between $80,000 and $90,000 ($160,000 to $180,000 for married filing jointly) — these thresholds are fixed by statute and not inflation-indexed. Married filing separately filers cannot claim the LLC at all, the same restriction that applies to the AOTC.
How it works
The Lifetime Learning Credit equals 20% of up to $10,000 in qualified tuition and related expenses, capping the credit at $2,000 — and that cap applies per tax return, not per student, so a family with three students in school still tops out at $2,000 combined. Unlike the AOTC, the LLC has no limit on the number of years you can claim it and does not require the student to pursue a degree or attend at least half-time, which makes it useful for continuing education and single-course enrollment.
You claim the LLC on Form 8863 using the tuition figures from Form 1098-T, choosing it over the AOTC for any student whose expenses do not qualify for the more generous credit — most often because they are past the first four years of a degree or taking courses to acquire or improve job skills without pursuing a credential. Because the credit is entirely non-refundable, it only reduces tax you actually owe and cannot generate a refund on its own.
The LLC shares its $80,000 to $90,000 (single) and $160,000 to $180,000 (MFJ) phase-out range with the AOTC, and those thresholds are fixed by statute rather than adjusted for inflation, so they erode in relative value over time. Married filing separately filers cannot claim it at all. Because the LLC applies per return rather than per student, families with multiple part-time or graduate students sometimes find the AOTC's per-student cap more valuable if even one student qualifies for it.
Example: LLC for a part-time graduate course
A taxpayer takes two graduate-level courses at a local university to build skills for a career change, paying $2,800 in tuition for the year. The course does not lead to a degree and is not part of the first four years of postsecondary education, so it does not qualify for the AOTC.
Applying the Lifetime Learning Credit's 20% rate to the $2,800 in tuition gives a credit of $560. If the same taxpayer had instead spent the full $10,000 threshold on tuition, the credit would cap out at the maximum $2,000 for the return.
Frequently asked questions
Is the Lifetime Learning Credit per student or per return?
Do I need to be a full-time student to claim the LLC?
Can I claim the LLC every year I'm in school?
Related Terms
Education Credits
Tax credits for higher education expenses. The American Opportunity Credit is worth up to $2,500 per student for the first four years; the Lifetime Learning Credit is up to $2,000 per return.
AOTC (American Opportunity Tax Credit)
A tax credit of up to $2,500 per eligible student for qualified education expenses during the first four years of post-secondary education.
Adjusted Gross Income (AGI)
Your gross income minus specific adjustments such as student loan interest, IRA contributions, and self-employment tax. AGI is the starting point for calculating your taxable income.
Filing Status
Your tax classification based on marital and family situation — Single, Married Filing Jointly, Married Filing Separately, Head of Household, or Qualifying Surviving Spouse.