What are education tax credits available to taxpayers?

The American Opportunity Credit and the Lifetime Learning Credit are both designed to help taxpayers reduce their education expenses by providing tax benefits.

The American Opportunity Credit allows eligible students to claim a credit for qualified education expenses for the first four years of higher education. This can include tuition, fees, and course materials, up to a maximum amount per year. The credit is partially refundable, meaning that if the credit amount exceeds the tax owed, taxpayers can receive a portion of it as a refund.

On the other hand, the Lifetime Learning Credit is available for students enrolled in eligible educational institutions for any course or coursework to acquire or improve job skills. Unlike the American Opportunity Credit, the Lifetime Learning Credit is not limited to the first four years of higher education and can be claimed for an unlimited number of years. This credit is also non-refundable, which means it can only reduce tax liability to zero but will not generate a refund.

These education credits are structured to alleviate the financial burden of higher education, making them highly relevant for taxpayers looking to offset the costs associated with post-secondary education. The other credits mentioned in the other options do not pertain to education expenses but rather to different areas of taxation, such as family support, healthcare, and retirement savings.