The following is for informational purposes and was prepared to inform you about the benefits and requirements contained in the Tax Relief Act of 1997. However, Liberty University cannot provide tax advice. We suggest that students and parents consult a tax advisor for additional information on eligibility or instructions on filing for these tax credits.
The Tax Relief Act of 1997, which effective with the 1998 tax year, established a Hope Tax Credit and a Lifetime Learning Tax Credit for eligible persons who are paying higher education costs for themselves or members of their families. These benefits are in the form of nonrefundable tax credits and are computed by totaling amounts paid for qualified tuition and enrollment related expenses reduced by grants, scholarships and other tax-free educational assistance. In addition, the Tax Relief Act also created the Student Interest Deduction, which allows a taxpayer to deduct the amount of interest they have paid toward loans that have been acquired to pay for various educational expenses.
Tax year 2003 was the first year in which educational institutions were required to report financial information to the Internal Revenue Service (IRS) and to the student via the IRS form 1098T.
Find the answers to most common questions you ask about the Education Credits - the American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit (LLC). More information available here: https://www.irs.gov/credits-deductions/individuals/education-credits-questions-and-answers.