2019 American Opportunity Credit
For 2019, the American Opportunity Credit is $2,500 (Maximum credit), $2,000 (Expenses credited in full), $2,000 (Further expenses credited in part) and 25% (Rate on the further expenses).
Effective 2019-01-01Source: Publication 970 (2019), Tax Benefits for Education (IRS)Verified 2026-09-01
Compared with 2018
Every figure on this page is unchanged from 2018.
| Item | 2018 | 2019 | Change |
|---|---|---|---|
| Maximum credit | $2,500 | $2,500 | +$0 (+0.0%) |
| Expenses credited in full | $2,000 | $2,000 | +$0 (+0.0%) |
| Further expenses credited in part | $2,000 | $2,000 | +$0 (+0.0%) |
| Rate on the further expenses | 25% | 25% | +0% (+0.0%) |
Who it applies to
Taxpayers who pay qualified education expenses for an eligible student during the first four years of postsecondary education
What changed this year, and why
For 2019, the American Opportunity Credit allows a maximum of $2,500 per eligible student. The first $2,000 of qualified education expenses are credited in full, and the next $2,000 of expenses are credited at 25%. These figures are unchanged from 2018.
Common questions
- How is the American Opportunity Credit calculated?
- The first $2,000 of qualified education expenses per student are credited in full, and the next $2,000 of expenses are credited at 25%, producing a maximum credit of $2,500 per eligible student.
- Did the credit amounts change from 2018 to 2019?
- The 2019 credit amounts are the same as in 2018. The maximum credit is $2,500 per eligible student, with the first $2,000 of expenses credited in full and the next $2,000 credited at 25%.
40% of the credit is refundable, the rest only offsets tax
Under the 2019 American Opportunity Credit, 40% of the credit is refundable and the remaining portion is nonrefundable. This means that if the credit reduces your federal income tax liability to zero, you can still receive a refund for up to 40% of the total credit amount. The maximum credit is $2,500 per eligible student, and the expenses credited in full total $2,000 while further expenses of up to $2,000 are credited at a rate of 25%. The nonrefundable portion can only be used to offset tax you owe and is lost if your tax liability is insufficient to absorb it. The refundable portion is paid out as a refund even when no tax is owed. The refundable feature makes this credit particularly valuable for lower-income students and families who may have little or no federal tax obligation, because a meaningful part of the credit still reaches them as a direct refund. The rest of the credit follows the ordinary nonrefundable credit rules: it reduces tax dollar for dollar but any excess is forfeited.
40% of credit may be refundable; the rest is nonrefundable
Publication 970 (2019), Tax Benefits for Education (IRS)
The income at which you lose the credit entirely
For the American Opportunity Credit in 2019, your eligibility depends on your modified adjusted gross income (MAGI). If your MAGI is $90,000 or more as a single filer, head of household, or qualifying widow(er), or $180,000 or more if married filing jointly, you cannot claim the credit at all. Between these thresholds and lower income levels, the credit amount is gradually reduced based on your MAGI, meaning that taxpayers with moderate incomes receive a partial credit while those at or above the cutoff receive nothing. The MAGI calculation is explained in detail in the section titled "Effect of the Amount of Your Income on the Amount of Your Credit." This income limitation ensures that the credit is targeted toward taxpayers with lower to moderate incomes. If your income exceeds the applicable threshold for your filing status, you may still be eligible for the Lifetime Learning Credit, which has different income limits.
Your modified adjusted gross income (MAGI) is $90,000 or more ($180,000 or more if married filing jointly). MAGI is explained later under Effect of the Amount of Your Income on the Amount of Your Credit.
Publication 970 (2019), Tax Benefits for Education (IRS)
The same student can be claimed in only four tax years
For the American Opportunity Credit in 2019, a student cannot have previously claimed the credit (or the Hope Scholarship Credit that preceded it) for more than four tax years. This means that if the student or their parents already claimed the American Opportunity Credit for this same student in four earlier tax years, no additional credit is available for 2019. The four-year limit includes any years when the Hope Scholarship Credit was claimed for the same student, since the American Opportunity Credit replaced the Hope Credit. This lifetime limit ensures that the credit is available only during the typical four-year undergraduate period. Once a student has used the credit for four tax years, they become ineligible for the American Opportunity Credit for all future years, though they may still qualify for the Lifetime Learning Credit, which has no such limit.
The student didn't have expenses that were used to figure an American opportunity credit in any 4 earlier tax years
Publication 970 (2019), Tax Benefits for Education (IRS)
What counts as having finished the first four years
The American Opportunity Credit for 2019 is only available to students who have not yet finished their first four years of postsecondary education. This generally corresponds to the freshman, sophomore, junior, and senior years of college, as determined by the eligible educational institution. The credit does not count academic credit that was awarded solely based on proficiency examinations. Once a student has completed four years of postsecondary education before 2019, they no longer qualify for the American Opportunity Credit. However, if a student has only completed three years or less, or if the institution classifies them as still being within their first four years as of the beginning of 2019, they remain eligible. This requirement means that graduate students and those who have already earned a bachelor's degree or equivalent cannot claim this credit, though they may qualify for the Lifetime Learning Credit instead.
As of the beginning of 2019, the student had not com- pleted the first 4 years of postsecondary education (generally, the freshman through senior years of col- lege), as determined by the eligible educational insti- tution
Publication 970 (2019), Tax Benefits for Education (IRS)
Half-time enrollment in a degree program is required
To qualify for the American Opportunity Credit in 2019, the student must have been enrolled at least half-time in a program leading to a degree, certificate, or other recognized educational credential for at least one academic period beginning in 2019 (or in the first three months of 2020 if qualified expenses were paid in 2019). Half-time enrollment means the student is carrying at least half the normal full-time workload for their program, as defined by the educational institution. This requirement applies to at least one academic period during the year, not the entire year. Students enrolled less than half-time, or those taking courses that do not lead to a recognized credential, do not meet this eligibility requirement. This distinguishes the American Opportunity Credit from the Lifetime Learning Credit, which does not require half-time enrollment and is available to students taking even a single course.
For at least one academic period beginning in 2019 (or the first 3 months of 2020 if the qualified expenses were paid in 2019), the student was enrolled at least half-time in a program leading to a degree, certificate, or other recognized educational credential
Publication 970 (2019), Tax Benefits for Education (IRS)
A felony drug conviction disqualifies the student
The American Opportunity Credit for 2019 is denied if the student has been convicted of any federal or state felony for possessing or distributing a controlled substance as of the end of 2019. This disqualification applies regardless of when the conviction occurred or whether the student otherwise meets all other eligibility requirements. The rule is specific to felony-level drug offenses; misdemeanor convictions do not trigger this disqualification. This requirement reflects a policy decision to limit this particular tax benefit to students who have not been convicted of serious drug-related crimes. Students with felony drug convictions may still be eligible for the Lifetime Learning Credit, which does not have this restriction. The determination is made as of the end of the tax year, so a conviction occurring after December 31, 2019 would not affect eligibility for that year.
The student hasn't been convicted of any federal or state felony for possessing or distributing a controlled substance as of the end of 2019
Publication 970 (2019), Tax Benefits for Education (IRS)
How each figure was verified
Each number below was read from a stored copy of the document named beside it, and checked to occur word for word in the quoted sentence. The digest is of that stored text.
Publication 970 (2019), Tax Benefits for Education (IRS)
- Maximum credit
Maximum credit Up to $2,500 credit per eligible student
- Expenses credited in full
100% of the first $2,000 of qualified education expen- ses you paid for the eligible student
- Further expenses credited in part
25% of the next $2,000 of qualified education expen- ses you paid for that student
- Rate on the further expenses
25% of the next $2,000 of qualified education expen- ses you paid for that student