2024 American Opportunity Credit
For 2024, 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 2024-01-01Source: Publication 970 (2024), Tax Benefits for Education (IRS)Verified 2026-08-29
Compared with 2023
Every figure on this page is unchanged from 2023.
| Item | 2023 | 2024 | 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 in their first four years of postsecondary education
What changed this year, and why
For 2024, the maximum American Opportunity Credit is $2,500 per eligible student, the same as in 2023. The credit phases out at higher income levels. A portion of the credit may be refundable. The credit is available only for students in their first four years of postsecondary education who are enrolled at least half-time.
Common questions
- Is any part of the credit refundable?
- Yes. A portion of the credit may be refundable, meaning it can be received as a refund even if the taxpayer owes no tax.
Every amount on this page is a published figure rather than yours. The American Opportunity Credit calculator takes the number you enter and works it out against them, showing which published figure it used.
40% of the credit is refundable, the rest only offsets tax
For 2024, 40% of the American Opportunity Credit may be refundable; the rest is nonrefundable. This means that nearly half of the credit can be paid to the taxpayer as a cash refund even if no federal income tax is owed. The nonrefundable portion can only offset tax the taxpayer actually owes for the year; if it exceeds the tax liability, the excess is lost. This split is one of the features that distinguishes the American Opportunity Credit from the Lifetime Learning Credit, which is entirely nonrefundable. Because part of the credit is refundable, eligible taxpayers with little or no tax liability can still receive a direct payment from the IRS for a share of the qualified education expenses they paid on behalf of an eligible student.
Refundable or nonrefundable 40% of credit may be refundable; the rest is nonrefundable
Publication 970 (2024), Tax Benefits for Education (IRS)
The income at which you lose the credit entirely
You cannot claim the American Opportunity Credit at all if your modified adjusted gross income (MAGI) reaches certain thresholds. For 2024, the credit is completely eliminated when MAGI is $90,000 or more for single filers, heads of household, or qualifying surviving spouses, or $180,000 or more for married couples filing jointly. Between these amounts and lower phase-out thresholds, the credit is gradually reduced. Taxpayers whose income exceeds the upper limit receive no benefit from the credit regardless of how much they spent on qualified education expenses. MAGI is defined and explained in detail in the section titled Effect of the Amount of Your Income on the Amount of Your Credit within the same publication.
You can't claim the American opportunity credit for 2024 if any of the following apply. • Your filing status is married filing separately. • You are claimed as a dependent on another person's tax return, such as your parent's return. See Who Can Claim a Dependent's Expenses, later. • 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 (2024), Tax Benefits for Education (IRS)
The same student can be claimed in only four tax years
The American Opportunity Credit can be claimed for any given student for no more than four tax years in total. Once the credit has been claimed for that student for four prior tax years, the student is no longer eligible in any subsequent year, regardless of enrollment status or expenses paid. This four-year limit counts claims made by any taxpayer - parents, the student themselves, or any other person. For example, if a parent claimed the credit for a student in three prior years and the student then claims it on their own return in a fourth year, no further credit is available for that student in any future year. The limit is measured against tax years before the current year; for 2024, any four years before 2024 count against the student. This rule works alongside the separate requirement that the student must not have completed the first four years of postsecondary education.
2. The American opportunity credit has not been claimed by you or anyone else (see below) for this student for any 4 tax years before 2024.
Publication 970 (2024), Tax Benefits for Education (IRS)
What counts as having finished the first four years
A student is considered to have completed the first four years of postsecondary education if the institution where the student is enrolled awards the student 4 years of academic credit at that institution for coursework completed before the tax year begins. This determination is made by the eligible educational institution itself, not by the taxpayer. Academic credit awarded solely because of the student's performance on proficiency examinations is not counted toward the four years. If the institution classifies the student as having earned four years of credit before the start of the tax year, the student is generally not an eligible student for the American Opportunity Credit for that year, even if the student has not actually received a bachelor's degree.
Completion of first 4 years. A student has completed the first 4 years of postsecondary education if the institu- tion at which the student is enrolled awards the student 4 years of academic credit at that institution for coursework completed by the student before 2024.
Publication 970 (2024), Tax Benefits for Education (IRS)
Half-time enrollment in a degree program is required
To claim the American Opportunity Credit, the student must be enrolled at least half-time in a program leading to a degree, certificate, or other recognized educational credential for at least one academic period that begins during the tax year. If qualified expenses are paid in the tax year for an academic period beginning in the first three months of the following year, that period is treated as if it began in the tax year. The half-time enrollment requirement applies to only one academic period, not the entire year. The program must lead to a recognized credential; courses taken for personal enrichment without a degree or certificate goal do not qualify. The educational institution determines what constitutes half-time enrollment based on its own standards.
For at least one academic period beginning in 2024 (or the first 3 months of 2025 if the qualified expenses were paid in 2024), the student was enrolled at least half-time in a program leading to a degree, certificate, or other recognized educational credential.
Publication 970 (2024), Tax Benefits for Education (IRS)
A felony drug conviction disqualifies the student
To qualify for the American Opportunity Credit, the student must not have been convicted of any federal or state felony for possessing or distributing a controlled substance as of the end of the tax year. A conviction under either federal or state law for either possessing or distributing a controlled substance permanently disqualifies the student from the credit for that year, regardless of when the conviction occurred. This requirement is one of several eligibility conditions the student must meet; even if all other requirements - such as enrollment status, income limits, and education level - are satisfied, a felony drug conviction bars the credit entirely. The conviction must be final as of the close of the tax year for which the credit is claimed.
4. As of the end of 2024, the student had not been con- victed of a federal or state felony for possessing or distributing a controlled substance.
Publication 970 (2024), 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 (2024), 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