are student research grants taxable

• Student Loans

Are College Scholarships and Grants Taxable?

Updated: Jun 23, 2021, 8:02am

If you’re trying to save money on college costs, scholarships and grants are essential tools.  According to Sallie Mae’s How America Pays for College study , scholarships and grants covered 25% of students’ college expenses in 2020— an average of $7,626 per borrower.

Unlike student loans, scholarships and grants are a form of gift aid and don’t need to be repaid. By using gift aid to cover some of your expenses, you can reduce how much you have to pay out of your own pocket for your education.

While you don’t have to worry about repaying gift aid, you may be wondering whether scholarships and grants are taxable. In some cases, scholarships and grants do need to be reported on your income tax returns. Here’s what you need to know to file your return if you’ve received gift aid.

Are Grants and Scholarships Taxable as Income?

If you’ve been awarded scholarships or grants, you likely won’t need to borrow as much money in student loans . Whether or not grants and scholarships are taxable depends on a few important factors.

Grants and scholarships are tax free, meaning they’re excluded from your gross income, if the following criteria is met:

• You are pursuing a degree at an accredited college or university
• The award doesn’t exceed your qualified education expenses, such as tuition
• The award isn’t earmarked for other expenses, such as room and board
• The scholarship or grant isn’t paid in return for teaching, researching or other tasks

If you receive a scholarship or grant for a certificate program or are taking courses that won’t lead to a degree, the entire scholarship amount is taxable.

What Are Qualified Education Expenses?

A scholarship or grant is tax-free as long as it doesn’t exceed the amount you need to cover your qualified education expenses. According to the IRS, qualified education expenses include:

• Tuition and school-mandated fees for enrollment
• Mandatory course fees and expenses, such as lab fees, textbooks or equipment. For supplies and equipment to count as a qualified expense, they must be required for all students in the course.

What Doesn’t Count as a Qualified Education Expense?

When you go to college, the total cost of attendance is far more than the school’s tuition and fees. You also may have to pay for room and board, travel or other supplies like a new computer.

While those expenses may be part of your overall education costs, those things are not considered qualified education expenses for tax purposes. If you receive a scholarship or grant that covers those costs, the part of the award that paid for those items is taxable as income.

When Taxes Apply to Grants and Scholarships

If you’re trying to figure out what college scholarships are taxable, it’s important to know that the IRS’ rules apply to all sources of grants and scholarships. Whether your award comes from the federal government, the state, your college or a private organization, the award is only tax free if it’s used for qualified education expenses.

The rules don’t change if the award is based on merit or financial need; regardless if you earned the scholarship due to athletic skill or received a grant because of your income, the same taxation rules apply.

That doesn’t mean you have to turn down scholarships or grants that give you more than you need for tuition; it just means you have to report that amount on your taxes.

For example, Pell Grants are a form of federal financial aid for low-income students. For the 2021-2022 award year, the maximum amount you can receive in Pell Grants is $6,495, and it can be used to pay for the total cost of attendance at your school, not just tuition and fees.

Let’s say that Ben is an undergraduate student who qualifies for the maximum Pell Grant award. He uses $5,000 of his Pell Grant to cover the rest of the tuition he owes. He then uses the remaining $1,495 to pay for his apartment’s rent and a bus pass to get to school. Because room and board and transportation don’t fall under the IRS’ qualified education expenses, Ben would have to pay taxes on $1,495 of his grant.

How to Report Scholarships and Grants on Your Tax Return

To report scholarships or grants that paid for non-qualified education expenses on your tax return, you will need to fill out one of the following forms depending on your situation:

• Form 1040-U.S. Individual Income Tax Return
• Form 1040 SR-U.S. Tax Return for Seniors
• Form 1040 NR-U.S. Nonresident Alien Income Tax Return

In most cases, the scholarship or grant provider will send you a W-2 form showing what amount of the award is taxable.

Enter the taxable amount from your W-2 form on the line for wages, salaries, and tips. If the taxable amount was not included on a W-2 form, write “SCH” and write in the taxable amount on the dotted line next to the wage box.

If you need help filling out your forms or calculating how much to report, consult a tax professional. The IRS maintains a database of tax preparers that have professional credentials recognized by the IRS or that hold an Annual Filing Season Program Record of Completion. You can use the database to find a qualified professional near you.

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Education Tax Credits and Deductions That Can Lower Your Tax Bill

While it may be discouraging to have to pay taxes on your scholarships and grants, there are often other  ways to lower your tax bill based on your student status through education tax credits and deductions.

1. American Opportunity Tax Credit

Using the American Opportunity Tax Credit ( AOTC ), you can get a tax credit worth up to $2,500 for money spent on qualified education expenses. The credit is refundable, so if the credit reduces your tax bill to zero, you can get 40% of the remaining amount back as part of your tax refund.

To qualify for the AOTC, you must be enrolled at an accredited school and be pursuing a degree or recognized credential. You can only claim the AOTC for the first four years you’re in school.

There are income restrictions; the credit is phased out starting when you earn $80,000 annually (or $160,000 if married filing jointly). If you earn over $90,000 ($180,000 if you’re married filing a joint return) you aren’t eligible for the credit at all.

2. Lifetime Learning Credit

Like the AOTC, the Lifetime Learning Credit (LLC) is a tax credit that reduces the amount you owe when you file your federal tax return. Under the LLC, you can receive a credit worth 20% of up to $10,000 in qualifying education costs, to a maximum of $2,000.

Unlike the AOTC, the LLC is nonrefundable, so you won’t receive any money back if your refund brings your tax bill to zero.

You can claim the LLC if you’re taking classes to get a degree or to improve your job skills. You can claim the credit even if you return to school or are taking professional development courses.

There are income restrictions, so check with the IRS to see if you’re eligible. You can’t claim both the AOTC and the LLC for the same student in a single tax year.

3. Student Loan Interest Deduction

If you’ve taken out student loans to pay for college and have started making payments, you may qualify for the student loan interest deduction.

The student loan interest deduction reduces your taxable income. You can deduct the lesser of $2,500 or the amount of interest you paid on your student loans during the tax year.

To claim the deduction, you must be obligated by law to make payments on the loans. You must fall under the deduction’s income restrictions.

For more information about ways to offset your tax bill, read about available education tax credits and deductions .

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• Tax Planning

What Your Scholarships and Grants Mean for Your Taxes?

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Written by Jim Wang

• Published Aug 17, 2023

College can be very expensive and many students rely on scholarships and grants to help lower the cost of higher education.

When I attended Carnegie Mellon University, I had the help of need-based grants and a handful of merit-based scholarships. Back then, I was just glad to receive help and never even considered the tax implications. Fortunately, the tax code looks favorably at scholarships and grants.

If you are a student who received college scholarships or grants, here are some tax tips to help you understand how scholarships or grants impact your taxes.

Do you really have to pay taxes on a scholarship? The answer is… maybe.

Scholarships and Grants That Aren’t Taxed

The good news is that you won’t pay any taxes on scholarships or grants for what the IRS calls “qualified education expenses.” What qualifies as a non-taxable education expense? Any funds you receive to pay for tuition, school fees, books, or any supplies required for courses at your school.

The IRS also notes that to qualify, you must be a “candidate for a degree at an educational institution that maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it carries on its educational activities.”

There are no taxes to pay if you received a scholarship or fellowship as part of the National Health Services Corps Scholarship Program or the Armed Forces Health Professions Scholarship and Financial Assistance Program. This also applies to anyone who is part of a qualifying work-learning-service program.

So what scholarships and grants ARE taxable?

Taxable Scholarships and Grants

If you paid for your qualified education expenses and have scholarship funds left over, that leftover money counts as taxable income.

Any scholarship funds that go towards your room, board, or utilities are taxable. Any funds used for college expenses outside of the required supplies for your education are taxable too and applies to any school-related travel that is paid for by the scholarship or grant funds.

If your grants, fellowships or assistance programs require you to provide some type of service while enrolled in school, this could make them closer to a stipend or payment rather than a scholarship. For example, if you received a $10,000 scholarship and $4,000 was designated as compensation for teaching or research while at school, that portion would be taxable income. The remaining $6,000 may not be taxable if used towards qualifying education expenses.

Paying Taxes on Scholarships and Grants

If any of the funds count as taxable income, you should receive a Form W-2 from your scholarship’s provider. The W-2 will show you the taxable amount to claim on your taxes. If you don’t receive a W-2, it’s a great idea to reach out to your scholarship provider to find out why.

Also, keep in mind that you cannot “double-dip.” If you paid for qualified education expenses with tax-free scholarship funds, you can’t also claim an education tax benefit like the American Opportunity Tax Credit or the Lifetime Learning Credit .

Don’t worry about knowing these tax rules. Meet with a TurboTax Full Service Expert who can prepare, sign and file your taxes, so you can be 100% confident your taxes are done right. Start TurboTax Live Full Service today, in English or Spanish, and get your taxes done and off your mind. 

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One response to “What Your Scholarships and Grants Mean for Your Taxes?”

You should also add taxable scholarships can trigger the so-called “kiddie tax.”

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Research Voyage

Research Tips and Infromation

Are Research Grants Taxable? Tax Implications you Need to Know as a Researcher

Introduction

Distinction between grants intended to cover expenses and grants intended to compensate for time and effort, examples of research grants and their tax implications, research grant tax implications in united states, research grant tax implications in united kingdom, research grant tax applicability in canada, research grant tax applicability in india, professional advice on research grant tax applicability.

Research grants are financial awards given to individuals or organizations for the purpose of conducting research. These grants can be critical for advancing scientific knowledge and improving quality of life, as they allow researchers to conduct studies and experiments that might not otherwise be possible due to lack of funding.

There are several different types of grants, including competitive grants, collaborative grants, travel grants, and equipment and materials grants. Competitive grants are awarded through a competitive application process based on merit, such as the National Science Foundation’s grants for scientific research.

Collaborative grants are awarded to teams or groups of researchers working on a project together, such as a grant for a multi-institutional research project. Travel grants are awarded to cover expenses related to travel for research purposes, such as attending conferences or conducting field research. Equipment and materials grants are awarded to cover the cost of necessary research equipment or materials, such as a grant for a new microscope or research chemicals.

Without research funds, many important scientific discoveries and advancements may never have been made. However, it’s important to understand the tax implications of research grants, as the tax laws related to these grants can be complex and vary depending on the specific circumstances and the laws of the country involved. In the following sections, we will explore the taxation of research grants in more detail and examine how tax laws related to research grants differ between countries.

In case you are not familiar with writing research grant proposals, then please visit my post on  Research Grants Uncovered: A Step-by-Step Guide to Funding Your Research Projects . This post will help you in writing powerful research grant proposals in minimal time.

Taxation of Research Grants

Research grants can have different tax applications depending on a number of factors, including the country where the grant is awarded, the type of grant, and the purpose of the grant. Some research grants may be taxable, while others may not be. The taxation of research funds can be determined by several factors, including the specific laws of the country in which the grant is awarded, the terms of the grant agreement, and the purpose of the grant. Some grants may be intended to cover research expenses, such as equipment, supplies, and travel, while others may be intended to compensate for time and effort, such as salary or wages.

A key factor in determining the taxation of research funds is the distinction between grants intended to cover expenses and those intended to compensate for time and effort. Grants intended to cover expenses are generally not taxable, as they are meant to reimburse the recipient for costs incurred during the research project. Examples of expenses that may be covered by research funds include travel, equipment, and supplies.

On the other hand, grants intended to compensate for time and effort are typically taxable. These grants are intended to provide the recipient with compensation for their work on the research project, and are similar to a salary or wage. Examples of grants that may be intended to compensate for time and effort include stipends and fellowships.

The tax implications of grants can vary depending on the specific circumstances of the grant. Here are a few examples:

• Research grant to cover expenses: A researcher receives a grant to cover the cost of travel and lodging for a conference related to their research project. This grant would typically be non-taxable, as it is intended to reimburse the researcher for expenses incurred during the research project.
• Research grant to compensate for time and effort: A graduate student receives a fellowship to support their research project. The fellowship provides the student with a stipend of $25,000 per year for two years. This stipend would typically be taxable, as it is intended to compensate the student for their time and effort spent on the research project.
• Research grant to cover expenses and compensate for time and effort: A researcher receives a grant to cover the cost of equipment and supplies for their research project, as well as a stipend of $10,000 to compensate them for their time and effort. In this case, the grant would likely be partially taxable, with the stipend portion being subject to taxation while the portion intended to cover expenses would not be taxed.

Understanding the taxability of research grants is important for researchers, as failure to properly report grant income can result in penalties and legal consequences. By understanding the factors that determine the taxation of research grants and the different types of grants that may be subject to taxation, researchers can ensure that they comply with tax laws and properly report their grant income.

Tax Laws for Research Grants by Country

The taxation of research grants can vary depending on the specific tax laws of the country where the grant is awarded. Here is an overview of how research grants are taxed in different countries, as well as examples of tax laws related to research grants in the United States, United Kingdom, Canada, and India.

In the United States, research grants are generally subject to taxation unless they are specifically exempted under the tax code. Grants that are intended to cover expenses related to the research project, such as equipment, supplies, and travel, are typically non-taxable. However, grants that are intended to compensate for time and effort, such as stipends and fellowships, are usually taxable.

One notable exemption for grants in the US is the National Institutes of Health (NIH) Grant Policy , which exempts certain types of grants from taxation. For example, NIH grants that are used to cover research expenses, such as equipment, supplies, and travel, are typically non-taxable. However, NIH grants that provide stipends or salaries to researchers may be taxable.

In the United Kingdom, research grants are also subject to taxation unless they are specifically exempted. Grants that are intended to cover research expenses, such as equipment and supplies, are generally non-taxable. However, grants that provide stipends or salaries to researchers may be taxable.

There are also specific exemptions for research grants in the UK, such as the Research Councils UK (RCUK) Grant Policy . Under this policy, grants that are intended to cover research expenses are generally non-taxable, while grants that provide stipends or salaries to researchers may be taxable.

In Canada, research grants are generally subject to taxation unless they are specifically exempted. Grants that are intended to cover research expenses, such as equipment and supplies, are usually non-taxable. However, grants that provide stipends or salaries to researchers may be taxable.

One notable exemption for research grants in Canada is the Natural Sciences and Engineering Research Council of Canada (NSERC) Grant Policy . Under this policy, grants that are intended to cover research expenses are generally non-taxable, while grants that provide stipends or salaries to researchers may be taxable.

In India, research grants are generally subject to taxation unless they are specifically exempted. Grants that are intended to cover research expenses, such as equipment, supplies, and travel, are generally non-taxable. However, grants that provide stipends or salaries to researchers may be taxable.

The Indian government offers certain tax exemptions for research grants. For example, grants awarded by the Department of Science and Technology and the Department of Biotechnology are exempt from income tax. Additionally, grants awarded by the University Grants Commission (UGC) for research purposes are also exempt from income tax.

While the tax laws related to research grants can be complex and vary by country, it’s important for researchers to understand their tax obligations and properly report their grant income. Seeking professional advice from a tax professional or accountant can help ensure compliance with tax laws and minimize the risk of errors or omissions on tax returns.

There are a number of potential consequences of failing to properly report research grant income. For example:

• Tax Penalties: Failing to report grant income or inaccurately reporting it can result in penalties and interest charges from tax authorities. Depending on the severity of the error, these penalties can be substantial and can have a long-term impact on a researcher’s finances.
• Legal Issues: In some cases, failing to properly report grant income can lead to legal issues, including fines or even criminal charges. This can be particularly problematic for researchers who rely on grant funding to support their work.
• Loss of Funding: Researchers who fail to comply with tax laws may also face consequences from funding agencies. Some agencies may require researchers to provide proof of compliance with tax laws as a condition of funding, and failure to comply could result in loss of funding or other negative consequences.

By seeking professional advice from a tax professional or accountant, researchers can ensure that they are properly reporting their grant income and complying with tax laws. These professionals can help researchers identify any tax exemptions or deductions they may be eligible for, and can assist with the preparation of tax returns and other documentation required by tax authorities.

Explore a world of research funding opportunities with scientifyRESEARCH , the open and curated database transforming the way researchers access critical funding information. Break free from traditional paywalls and effortlessly navigate the funding landscape. Visit scientifyRESEARCH’s  dynamic hub now by clicking link HERE

Research grants can be an important source of funding for researchers, but it’s important to understand the tax implications of these grants and properly report grant income. Seeking professional advice from a tax professional or accountant can help ensure compliance with tax laws and minimize the risk of errors or omissions on tax returns. This can help researchers avoid tax penalties, legal issues, and loss of funding, and can support the long-term success of their research projects.

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• Expat tax rules

Stipend vs. Scholarship vs. Research Grants - Taxation Methods

To whomever you are, firstly - thank you for contributing to research and development and pursuit of furthering our knowledge of a particular field.  Without your efforts and intellectual curiosity, we would be naught for progress as a civilization, and relegated to becoming accountants. Keep up the good work..

Now - let’s examine the taxation of the various grants/monetary stimulus you can receive as a research scientist.

A stipend fully taxable and reported as wages, although W2 not issued;

Scholarship - partially taxable. Amount spent on tuition and qualified education expenses (provide link) not taxable, the remainder is taxable ordinary income. Reported on 1098-T if from USA stipend is treated as a

Scholarships

Scholarships are tax free (excludable from gross income) if you are a candidate for a degree at an eligible educational institution. These payments will not generate a W2, 1099, but if received from a US institution it will be on form 1098-T.

The payment received by the individual will be tax free if it is used for Qualified Expenses.

- Tuition & required fees

- Books/supplies/equipment required for all students in the course

Expenses that are not qualified include life expenses such as room & board and travel. The grant also cannot include payment for services such as teaching, research, or other services as a condition for receiving the scholarship.

There are exceptions to this rule -- if you receive the amount under one of these programs.

-  The National Health Service Corps Scholarship Program (NHSC)

-  The Armed Forces Health Professions Scholarship and Financial Assistance Program (HPSP)

Fellowship and Research Grants

Generally, research grants is non-taxable (ie - excludable from gross income) if they meet one of the following conditions:

a.  The grant qualifies as a prize or award that is excludible from gross income under Internal Revenue Code section 74(b).

In non-legalese,  what this means is that the individual could not have made an action to enter the contest of proceeding on their own, the individual is not required to render future services as a condition to receiving the award, and the prize/award is transferred by the payor to a governmental unit or organization.

b. The grant/prize remains non-taxable if  the grant's purpose is to achieve a specific objective - ie produce a report or product, or to improve or enhance a literary, artistic, musical, scientific, teaching, or similar capacity, skill or talent of the grantee.

Non-US citizen grants

Generally, academic institutions who issue grants and fellowship payments to Nonresident Aliens (present in the US) - will issue form 1042-S, which will also contain withholding information. The amount of withholding will depend on the visa status of the recipient. 

F-1, J-1, M-1, or Q-1 --- a stipend paid to a non-resident alien with these visas will be subject to federal tax  withholding at a rate of 14% unless tax treaty relief is available.

Non-US persons with a B visa will have 30% of payments withheld, without provisions for reduction of withholding.

Tax Guidelines for Scholarships, Fellowships, and Grants

Taxes can be confusing, especially for young adults who have never had to file taxes before. Yet when beginning college, it is important to learn about and understand how scholarships impact your taxes, so that you are prepared at tax time. There are simple guidelines from the Internal Revenue Service (IRS) that help you determine if you will claim all or part of your scholarship amounts as income on your taxes, meaning you are required to pay taxes on them.

Download the PDF

Here are the guidelines quoted directly from the IRS.  (Topic No. 421 Scholarships, Fellowship Grants, and Other Grants)

A scholarship is generally an amount paid or allowed to a student at an educational institution for the purpose of study. A fellowship grant is generally an amount paid or allowed to an individual for the purpose of study or research. Other types of grants include need-based grants (such as Pell Grants) and  Fulbright grants .

Not Taxable

If you receive a scholarship, a fellowship grant, or other grant, all or part of the amounts you receive may be tax-free. Scholarships, fellowship grants, and other grants are tax-free if you meet the following conditions:

• You’re a candidate for a degree at an educational institution that maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it carries on its educational activities; and
• The amounts you receive are used to pay for tuition and fees required for enrollment or attendance at the educational institution, or for fees, books, supplies, and equipment required for courses at the educational institution.

You must include in gross income:

• Amounts used for incidental expenses, such as room and board, travel, and optional equipment.
• Amounts received as payments for teaching, research, or other services required as a condition for receiving the scholarship or fellowship grant. However, you don’t need to include in gross income any amounts you receive for services that are required by the National Health Service Corps Scholarship Program, the Armed Forces Health Professions Scholarship and Financial Assistance Program, or a comprehensive student work-learning-service program (as defined in section 448(e) of the Higher Education Act of 1965) operated by a work college.

How to Report

Generally, you report any portion of a scholarship, a fellowship grant, or other grant that you must include in gross income as follows:

• If filing  Form 1040  or  Form 1040-SR , include the taxable portion in the total amount reported on the “Wages, salaries, tips” line of your tax return. If the taxable amount wasn’t reported on Form W-2, enter “SCH” along with the taxable amount in the space to the left of the “Wages, salaries, tips” line.
• If filing  Form 1040-NR , report the taxable amount on the “Scholarship and fellowship grants” line.”

Now that you’ve read the IRS guidelines, you can ask yourself the questions below:

• What is the total amount I received from scholarships, fellowships and grants during the tax year I am filing (Jan-Dec)?
• Of that amount, what amount did I use for tuition and fees required for enrollment or attendance at the educational institution, or for fees, books, supplies, and equipment required for courses at the educational institution?

Example: If your class required that you purchase an I-Pad to complete the course, it could be considered a required expense, but if you bought the I-Pad for convenience and it was not required, it would be considered as taxable income.

Subtract the amount you used for required expenses (question 2) from the total amount of scholarships, fellowships, and grants you received (question 1). That is the amount that you used for incidental expenses, such as room and board, travel, and optional equipment and amounts received as payments for teaching, research, or other services required as a condition for receiving the scholarship or fellowship grant.

This amount is taxable and must be claimed as income on your taxes. 

The IRS has an  online assistant  you can use to decide how much of your scholarships (if any) are taxable.

There also is a tax credit that may be available to students (for independent students) or your parents (for dependent students) if you got a Form 1098-T from your college. The credit is called the  American Opportunity Tax Credit  (AOTC). According to the IRS:

“To be eligible for AOTC, the student must:

• Be pursuing a degree or other recognized education credential
• Be enrolled at least half time for at least one academic period* beginning in the tax year
• Not have finished the first four years of higher education at the beginning of the tax year
• Not have claimed the AOTC or the former Hope credit for more than four tax years
• Not have a felony drug conviction at the end of the tax year”

To claim AOTC, you must complete the  Form 8863 PDF  and attach the completed form to your tax return.

We know that this is a lot of information and it can be confusing. As you begin to file your taxes, we encourage you to reach out to people in your support system and utilize the resources offered through the IRS. In addition to the resources we have referenced above, the  IRS  has also partnered with several  organizations  to help people prepare and file their federal individual income tax returns for free. Typically, you can file your taxes as early as February and they are due in April. Check the IRS website for exact filing dates for this year and if possible, file your taxes early so that you can get your refund faster. 

Tax Department

Finance Division

• Tax Forms and Exemptions
• Unrelated Business Income Tax
• Definitions of Types of Employees and Contractors
• Form Exemptions
• Collection on Sales
• Schedule F Reporting
• Tax Issues on Payments to International Individuals & Companies
• Student Travel Grants & Reimbursements
• Processing Gifts, Prizes and Awards to Employees
• Corporate Tax Considerations
• Employment Tax Considerations
• University Tax Frequently Asked Questions
• Meeting with the Tax Department
• Foreign National Information System
• Taxation of Wages for International Students

Taxation of Scholarships, Fellowships & Stipends

• Refund of Social Security and Medicare Taxes
• State Withholding Form Instructions
• Social Security Number & Individual Taxpayer identification Number
• Forms and Publications
• Frequently Asked Questions for International Students and Scholars
• Tax Implications and Reporting Requirements of Payments to Nonresident Aliens
• Taxation of Wages for U.S. Citizens and Residents
• Student Loans
• Social Security and Medicare Taxes (FICA)
• State Income Taxes
• Tax Implications and Reporting Requirements of Payments to U.S. Citizens, Permanent Residents or Resident Aliens
• Frequently Asked Questions for U.S. Citizens and Residents

A scholarship payment received by a candidate for a degree is generally not taxable income to the student if it is used for "qualified expenses." Qualified expenses are defined by the Internal Revenue Service (IRS)  and include tuition and required fees, and/or for books, supplies, and equipment required of all students in the course. These payments do not need to be reported to the IRS by the student or the university.

A scholarship/fellowship used for expenses other than qualified expenses is taxable income. Taxable scholarships/fellowships are generally referred to as stipends and are payments for which no services are rendered or required. Examples of stipends are payments that can be used for living and incidental expenses such as room and board, travel, non-required books and personal computers, etc. The granting department is responsible for correctly determining the amount, which should be classified as a stipend, but such determination is always subject to review and reclassification by the Tax Department. All stipends are paid through University Payables except for certain athletic living stipends, which are paid through Student Account Services .

Stipends are subject to withholding when paid to nonresident aliens (NRAs). The withholding tax rate is 30%. However, the withholding tax rate may be reduced to 14% if the stipend is paid to an NRA student or scholar with an F-1, J-1, M-1, or Q-1 visa. Currently, state taxes are not required to be withheld by the university even though the payments may be taxable in the state. This, however, is subject to changes in state legislation. A taxable scholarship/fellowship is not subject to FICA withholding since the payment is not for services.

Students or scholars from countries that have a tax treaty with the U.S. that includes a scholarship/fellowship article may claim exemption or a reduction of tax withholding if they meet the requirements of the treaty. The student or scholar must, however, complete the required forms with the university's Tax Department.

The university reports stipend payments and the amount of federal tax withheld, if any, on Form 1042-S to the NRA student or scholar and to the IRS. NRA students and scholars are responsible for reporting these payments and remitting any tax due with their personal income tax return at the end of the year on Form 1040-NR and the corresponding state forms.

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Line 13010 – Taxable scholarships, fellowships, bursaries, and artists' project grants

Report amounts that you received as a scholarship, fellowship or bursary, or a prize for achievement in a field of endeavour ordinarily carried on by you (other than a prescribed prize) that were not received in connection with your employment or in the course of business, to the extent  that these amounts are more than your scholarship exemption. If you received a research grant, see Line 10400 – Other employment income .

Elementary and secondary school scholarships and bursaries are not taxable.

A post-secondary program that consists mainly of research is eligible for the scholarship exemption, only if it leads to a college or CEGEP diploma, or a bachelor, masters, or doctoral degree (or an equivalent degree). Post-doctoral fellowships are taxable.

Scholarship exemption

To claim a scholarship exemption, you must be enrolled in an educational program in which you are a qualifying student in 2022, 2023 or 2024.

Full-time enrolment

Post-secondary school scholarships, fellowships, and bursaries are not taxable if you received them in 2023 for your enrolment in a program for which you are considered a full-time qualifying student for 2022, 2023 or 2024.

The scholarship exemption will be limited to the extent that the award was intended to support the student’s enrolment in the program. To determine what portion of your award was intended to support your enrolment, you should consider such factors as:

• the duration of the program
• any terms and conditions that apply to the award
• the period for which support is intended to be provided by the award

Part-time enrolment

If you have received a scholarship, fellowship, or bursary related to a part-time program for which you are a part-time qualifying student for 2022, 2023, or 2024, the scholarship exemption is limited to the tuition paid plus the costs of program-related materials.

To calculate your scholarship exemption, see Scholarship exemption – Part-time enrolment .

For more information, see Income tax folio S1-F2-C3, Scholarships, Research Grants and Other Education Assistance .

I have an amount in box 105 of my T4A slip from a university. I was not considered a qualifying student. Do I have to report this income on my return?

Only the part of the total of all the amounts you received in 2023 (box 105 of your T4A slips) that is more than $500. 

Only the part of the total of all amounts you received in 2023 (box 105 of your T4A slips) that is more than $500.   

For more information on completing your Income Tax and Benefit Return, go to Guide P105, Students and Income Tax .

Certain scholarship, fellowship and bursaries are not taxable, such as:

• elementary and secondary school scholarship and bursaries
• post-secondary school scholarship, fellowship, and bursaries received in 2023 if you are considered a full-time qualifying student for 2022, 2023, or 2024

If you received an artists' project grant, you may be able to claim certain exemptions.

For more information, see Students.

Forms and publications

• Federal Income Tax and Benefit Guide
• Guide P105, Students and Income Tax
• Income tax folio S1-F2-C3, Scholarships, Research Grants and Other Education Assistance
• Income Tax Folio S4-F14-C1, Artists and Writers

Related topics

• Line 10400 - Net research grants
• Line 32300 - Tuition, education, and textbook amounts
• Artists' project grants

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Paying taxes on small research grants - PhD student

I am a PhD student at a university in the US. During 2023, I was awarded $4000 in research grants. This money was disbursed directly to my bank account, and I've been told it is taxable income. Is there any way to write these expenses off? The funds were used for travel to a research site, DNA sequencing, and other research expenses. It seems unfair for me to have to pay taxes on this "income" which was used exclusively for research expenses for my dissertation.

I've been told I can use a 1040 C form to write these off as business expenses--is that possible? Are there other options?

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Graduate Scholarships and Financial Aid

New York Institute of Technology offers federal grants, loans, and academic scholarships and grants to graduate students.

We review applications for admission to New York Tech automatically for the scholarships and financial aid listed below.

To help you determine your costs. Graduate Tuition Calculator.

Available Scholarships & Financial Aid

Discover the full range of scholarships, grants, loans, and financial aid assistance available to our graduate students.

Federal Financial Aid

Federal financial aid is available to U.S. citizens and U.S. permanent residents in the form of federal loans. Domestic graduate students who wish to apply for federal loans must fill out the  Free Application for Federal Student Aid (FAFSA) .

• Unsubsidized Direct Stafford Loan:  Non-need-based, low-interest, fixed-rate loan available to undergraduate, graduate, or professional degree candidates registered for at least six credits in an academic program that leads to a degree. Repayment is deferred until six months after graduation, if you drop below half-time status, or take classes as a non-matriculated student. You may receive both subsidized and unsubsidized loans for the same enrollment period, but the total amount of these loans may not exceed the annual loan limit.
• Federal Graduate and Professional Student PLUS Loan:  With terms nearly identical to the Parent PLUS loan, the “Grad PLUS” is also a credit-based, federally guaranteed loan awarded to students themselves who are registered for at least six credits in graduate or professional degree programs. Similar to the Parent PLUS loan, a Graduate/Professional student must complete Graduate PLUS application, accessible on  studentaid.gov . A PLUS Loan applicant who has an adverse credit history may still be able to receive a loan by documenting existing extenuating circumstances or by obtaining an endorser who does not have an adverse credit history. An endorser is someone who agrees to repay the loan if the borrower fails to do so. Also, if a Graduate Student/Professional PLUS applicant is denied the PLUS loan, s/he must complete Credit Counseling on studentaid.gov. It will not reduce your eligibility for the Stafford Loan, but the amount of any Stafford loans you will affect the amount of your PLUS loan. The PLUS loan is limited to the cost of attendance minus other aid received, as certified by New York Tech.

The Federal College Work Study Program provides part-time employment to assist eligible enrolled students in paying for educational expenses. It is based on economic need. If you are not eligible for Federal College Work Study, you can also become a student aid. For more information, please contact  Student Employment.

New York Tech Scholarship Renewal Criteria

All graduate students must maintain a 3.3 cumulative GPA to renew their scholarship. Recipients of the New York Tech Graduate Alumni Award must maintain a 3.0 GPA to renew this award.

Graduate Scholarships

In order be eligible, you must:

• Complete the  FAFSA  each year you are enrolled at New York Tech (U.S. students only).
• Be a full-time student.
• Maintain a cumulative GPA as specified by the scholarship.
• Meet Satisfactory Academic Progress (SAP) requirements at all times.

Scholarships and grants are renewable each semester, as long you meet the scholarship requirements. They are for tuition only, divided equally between fall and spring semesters. Institutional aid is credited to a student’s account after the end of the add/drop period. They are not applicable to summer session attendance.

Scholarships are determined by a variety of factors. The minimum academic requirements for each award are listed below. The charts are based on your year of entry and include the minimum GPA you need to maintain to renew your scholarship each year.

Graduate Assistantships

Graduate assistantships are offered to qualified students enrolled in our graduate degree programs providing partial or total tuition remission. Depending on your skills and experience and the needs of a specific program, graduate assistants may be asked to work as a Graduate Assistant (GA), Research Assistant (RA), or Teaching Assistant (TA).  Learn more .

Graduate Scholar Award (GSA): Up To $3,000 Per Year

This award recognizes the talents of entering graduate students who have demonstrated a high level of academic achievement. It consists of up to $3,000 per-year tuition-only credit for a maximum of three years (six semesters) of continuous full-time enrollment (nine credits). Proration may be available for applicants taking less than nine graduate level credits per semester, but you must register for at least three graduate level credits per semester for this proration. In addition, this scholarship applies only to fall and spring semesters and is not applicable to graduate courses that are offered at a discounted tuition rate.

Typically, students with the following criteria qualify:

• Complete the  FAFSA  (U.S. students only).
• Be accepted to a matriculated graduate degree program.
• Have earned a bachelor’s degree with a 3.3 CGPA. * Please note that scholarships are awarded based on your GPA at the time of application. If your final, official GPA is higher than when you applied, the Office of Admissions will reconsider scholarship awards up until the beginning of the semester.
• Bridge students are not eligible for scholarships during the time they are taking bridge coursework. They become eligible once matriculated into their degree program. To qualify for scholarships after matriculation, bridge students must have achieved a minimum CGPA of 3.3 for their bachelor’s degree and a CGPA of 3.3 for any bridge coursework.
• If your program requires a GRE, then you must have earned a high enough combined score on the verbal and quantitative sections as determined by your academic department.
• M.B.A. applicants must have a minimum GMAT score of 400.
• International students must have a minimum TOEFL score of 79, IELTS score of 6, PTE score of 53, or Duolingo score of 105.
• All students must be fully accepted without academic conditions.

Renewal Criteria

Awards are renewable each semester if you have a FAFSA on file, meet  Satisfactory Academic Progress (SAP)  criteria, and maintain a 3.3 cumulative GPA. This award applies to fall and spring semesters only.

New York Tech Graduate Alumni Award

This award is offered to students who hold a New York Institute of Technology bachelor’s or master’s degree only. The award is NOT applicable to students in dual degree programs with the College of Osteopathic Medicine.

To be considered, all students must complete an application each academic year. This award will be allotted on an annual basis for a maximum of three (3) years or six semesters depending on the student meeting all of the following criteria required each semester.

• Allotted $1,000 tuition-only credit for every three credits, up to $6,000 per year ($3,000 per semester)
• Student must complete their degree on the Long Island or New York City campus of New York Tech.
• This award is not applicable to students enrolled in the BS/DO, BS/DPT, BS/MSOT, or BS/MSPA joint-degree undergraduate/graduate programs.
• This award is not applicable to students with tuition remission or tuition exchange or for students who take classes at an already discounted tuition rate.
• This award is not applicable to students receiving a second bachelor’s degree at New York Tech.
• This application does not guarantee an award. This award is subject to fund availability.
• Complete the  FAFSA  and submit any requested  verification documents  (excluding International students)
• Must be fully matriculated in one of New York Tech’s graduate degree-granting programs in New York
• Must have a prior baccalaureate or master’s degree from New York Tech
• Cannot be enrolled in the BS/DO, BS/DPT, BS/MSOT, or BS/MSPA joint-degree undergraduate/graduate programs at New York Tech.
• Enrolled in at least three (3) credits
• Maintain  Satisfactory Academic Progress (SAP)
• Maintain at least a 3.0 cumulative grade point average
• Complete and submit a  New York Tech Graduate Alumni Award application  annually

Application Deadlines

• For Fall Admits:  July 15
• For Spring Admits:  December 15

Life Science Achievement Award: Up To $3,975 Per Year

This scholarship is awarded only to students who are matriculated in the B.S. in Life Sciences dual degree programs in occupational therapy, physical therapy, and physician assistant studies. This award is not applicable to students enrolled in the combined Life Sciences/Doctor of Osteopathic Medicine degree program. The award bridges the gap between your undergraduate phase and your graduate or professional phase.

This one-time scholarship provides up to $3,975 for the first year (including summer if applicable) of the professional phase of the combined BS/MS.OT, BS/MS.PA and BS/DPT programs for the completion of your undergraduate degree program. Full-time attendance is required.

• Complete the  FAFSA  (U.S. students only).
• Maintain a 3.3 cumulative GPA.
• Satisfactorily complete the classes you registered for in the previous semester.
• Be matriculated in the B.S. in Life Sciences dual degree programs in occupational therapy, physical therapy, and physician assistant studies.

Mayor’s Graduate Scholar Award

This award is for students who work for the Office of the Mayor of New York. It consists of $3,000 per year for up to three years or six semesters. This scholarship cannot be combined with the New York Tech Graduate Scholar Award. Students must have a bachelor’s degree and be admitted to a New York Tech graduate program.

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How to Pay for College

Explore various ways to pay for college, including scholarships, grants, student loans, and other financial aid programs to help cover tuition costs and expenses.

This article contains general information and is not intended to provide information that is specific to American Express products and services. Similar products and services offered by different companies will have different features and you should always read about product details before acquiring any financial product.

At-A-Glance

The Free Application for Federal Student Aid (FAFSA ® ) can help give students access to various types of financial aid opportunities for college. 

Grants, scholarships, work-study programs, and loans can help you to cover college costs.

You can also lower your costs by starting at a community college, buying used textbooks, and graduating on time or even early.

Paying for college can seem like a daunting task, but it doesn’t have to be. There are many ways to pay for college today, including numerous financial aid options available to students and their families. In this article, we’ll outline various strategies for financing a college education, empowering you to make informed decisions and pursue your academic goals without breaking the bank.

Applying for Financial Aid

To apply for financial aid, you should fill out the Free Application for Federal Student Aid (FAFSA ® ).

The FAFSA can open doors to a variety of financial aid options and should be the first step you take when looking for financial aid.

When it comes to filling out the FAFSA form, FAFSA recommends that you start by creating a StudentAid.gov account. All contributors (that is, anyone who is required to provide information on the FAFSA form) are required to create a Student.Aid.gov account as well. When filling out your form, you may need to provide information including your verified account username and password, parent or spouse contributor name, their date of birth, Social Security number, email address, and income and asset information. FAFSA estimates that it takes most people less than one hour to fill in the FAFSA form. 1

You can fill out FAFSA when you’re in the 12th grade, or the year before you plan to attend college. Ideally, you’ll want to fill out your FAFSA as soon as it becomes available. It’s best to complete your FAFSA as early as you can to help ensure you don’t miss out on opportunities for financial aid. 2

To learn more, visit the Federal Student Aid Website, page: Filling Out the FAFSA ® Form .

Several of the common types of financial aid that can help you pay for college include: 3

Grants are usually offered based on financial need. If you receive a grant, you don’t have to pay it back.

With federal and institutional grants, you will be considered for aid when you submit your FAFSA. However, you can find additional grants from your state or even private institutions. To find state grant programs, you can visit the Department of Education’s website and use the State Contacts tool to find the agency that distributes each state’s grants. In order to be eligible for grants, most states will require you to fill out the FAFSA, but some states (including Pennsylvania, New Jersey and New York) may have a separate grant application in addition to the FAFSA. 4

As with grants, you don’t have to repay scholarships. Some scholarships are need-based while others are merit-based and distributed based on factors like grade point average (GPA), test scores, and extracurricular activities.

Some scholarships require you to first submit the FAFSA. You may also be able to find additional scholarships by contacting the financial aid office at the school you’re planning to attend or conducting research online.

The Federal Work-Study Program provides jobs to qualifying students so they can make money to cover college expenses. A few examples of work-study jobs include tutors, computer lab technicians, and researchers. Filling out the FAFSA form is the only way to be considered for Federal Work-Study programs.

Federal student loans are offered by the federal government. They may come with perks like flexible repayment plans and student loan debt forgiveness programs . However, most of them have borrowing limits, meaning you may not receive enough money to pay for your entire college education. In order to get a federal loan, you’ll first need to complete the FAFSA form.

Private student loans come from private lenders, such as banks and credit unions. While you may be able to borrow as much as you need with a private student loan , you may also need to meet certain credit and income requirements, which can be difficult to do. Private student loans may also have stricter repayment requirements and higher interest rates than federal student loans.

Did you know?

You can start researching and applying for scholarship programs when you’re between your junior and senior years in high school, allowing you to start the financial aid process early. 5

Saving for College

If you’re planning ahead for college, you can also take the proactive approach and save for college .

Fortunately, there are a variety of college savings tools available. One option is using what’s known as a 529 plan. A 529 plan allows for tax-free growth and withdrawals for tuition, room and board, books, and other education-related expenses. Other options you might want to explore include brokerage accounts and savings accounts. A high yield savings account is another option you’ll want to consider. These accounts typically offer a higher yield than many traditional savings accounts and may help you grow your money faster.

Ways to Lower College Costs

Even if you have a plan to pay for college, you’ll still want to take steps to keep your costs down. Here are some tips that can help you minimize college expenses.

Community colleges tend to be more affordable than four-year colleges and universities, offering lower tuition costs and often a lower cost of living as well. To save some cash, you can begin your education at a community college. After gaining your associate degree in two years, you can transfer to a four-year college or university to finish your degree. Just be sure to check that the four-year institution that you plan to finish at will accept credits from your community college. 6

It may be convenient to buy the textbooks you need for your classes at a bookstore on campus. However, you may be able to find more affordable prices by buying them used online or through other students who sell them after they’ve completed the course.

To save money, do your best to only borrow what you need to cover your college costs and living expenses. Overborrowing so you can upgrade your lifestyle can quickly lead to more debt, so make sure you prioritize and budget carefully while you’re studying.

Graduating late means you could end up paying more for your overall college education. Try to be as efficient as possible and graduate on time. Even better, consider graduating earlier by earning class credits in advance if this is an option that’s available for you.

Some employers may offer tuition reimbursement programs. If you happen to be employed by a company that offers this after you graduate or while you’re still in school, you could be reimbursed for part of or all of your college education.

In addition to looking for ways to keep your costs low, you can also work on building your credit while you’re in college . Having a strong credit history can help you to qualify for financial products, like a car loan or apartment rental, down the road.

Frequently Asked Questions

What is the difference between subsidized loans and unsubsidized loans.

With subsidized loans, the federal government covers interest while you’re still in college and during six months after graduation. This offers a measure of flexibility for recent graduates who may be job hunting after graduation and may need additional time before they start making interest payments. With direct unsubsidized loans, you are responsible for paying interest during all periods. 7

Are there tax credits for college expenses?

There are a few tax credits available to help offset college expenses. These include the American Opportunity Tax Credit (AOTC) and The Lifetime Learning Credit (LLC), both of which can help to reduce the amount of tax that you owe. 8

How do I apply for scholarships and grants?

To apply for federal grants and scholarships, you’ll want to start by visiting the FAFSA website or looking at scholarships offered by the school that you’re planning on attending.

• For Scholarships: Some scholarships will require you to first submit the FAFSA form, however, you may be able to find additional scholarships by conducting research online. You may also want to contact the financial aid office at the school you’re planning to attend.
• For Grants: With federal and institutional grants, you will be considered when you submit your FAFSA form. However, for additional grants, you’ll also want to consider local organizations, membership associations, and charitable foundations, which may provide links to available college grants on their websites. You can use the Department of Education’s State Contacts tool to find the agency that distributes each state’s grants. 

Make sure you validate the authenticity of scholarships and grants before you apply.

The Takeaway

There are a variety of different ways to pay for college, such as grants, scholarships, work-study programs, and loans. In addition to these financial aid options, you can also take steps to help keep your costs low while you’re studying.

Show Article Sources

1  “ Apply for Aid ,” FAFSA

2 “ FAFSA: When to Fill Out - Junior or Senior Year? ,” CollegeVine

3 “ Understanding Financial Aid for College: A Guide ,” U.S. News

4 “ Guide to Grants for College ,” NerdWallet

5 “ Find and apply for as many scholarships as you can—it’s free money for college or career school! ,” Federal Student Aid

6 “ 10 Ways to Reduce College Costs ,” Education Planner

7 “ Direct Subsidized and Direct Unsubsidized Loans ,” Federal Student Aid

8 “ How to Pay for College Without Your Parents’ Help ,” LendingTree

Anna Baluch   is a personal finance writer from Cleveland, OH. She enjoys helping people from all walks of life make smart financial decisions. Her work can be seen on Credit Karma, Forbes, LendingTree, Insurify, and many other publications. Connect with Anna on LinkedIn .

All Credit Intel  content is written by freelance authors and commissioned and paid for by American Express. 

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NASBA announces research grants, opens 2025 applications

application .

Since its establishment in 2011, the grant program, led by members of NASBA's Education Committee, has awarded over $200,000. Its aim is to advance academic research on the educational issues impacting CPAs and the accounting profession. 

This year's recipients are University of Alabama associate professor Kris Hoang and doctoral student Amy Matthews. They received $5,500 for their study, which will investigate job stressors among early-career auditors and their influence on well-being in the workplace and career commitment. 

The team of Virginia Tech associate professor Denis Gracanin and Morgan State University associate professor Dina El Mahdy received $9,750 for their study, which aims to demystify accounting and make it an exciting education experience to increase enrollment, recruitment and retention by developing an immersive data analytics tool called DataWorld. 

Finally, Drexel University assistant clinical professor JT Thazhathel received $9,750 for a study that will examine the prevalence and practical uses of artificial intelligence among accountants. 

The call for next year's grant proposals opened on Aug. 13, 2024, and will close March 3, 2025, at 11:59 p.m. CST. Suggested research interest areas include:

• The integration of data analytics and AI as part of accounting education;
• Inclusivity within the CPA profession; and,
• Items related to the pipeline problem and the impact of licensing requirements on students' decisions to pursue accounting careers.

Suggested research areas are subject to change throughout the year.

NASBA encourages post-doctoral researchers and professors seeking funding to submit their proposals for consideration prior to the March deadline. The 2025 class of grant recipients will be announced in the summer of 2025. 

[email protected] .

Both presidential candidates have floated it, and there are benefits for both workers and employers — though not always how you'd expect.

Eligible taxpayers can apply between Sept. 4 to Oct. 31

The commission approved proposals from the PCAOB around contributory liability, the responsibilities of the auditor, and technology-assisted data analysis.

Greatland Corporation, the company behind Yearli, announced it has acquired Information Returns Inc.

In 2023, 125 violation cases of unauthorized access of tax return data were reported, the highest since 2018 —but instances of disclosure violations remains low.

Jeffrey Pawlow was most recently president of Engineered Tax Services, including the two he co-founded before their acquisition by ETS, The Growth Partnership and ABLE.

August 20, 2024 Volume 71 Issue 2

Alp ercil’s $10 million gift establishes penn climate sustainability initiative, kotaro sasaki: richard king mellon associate professor at penn vet, school of arts & sciences: appointments to endowed chairs, emily zimmerman: director of exhibitions and curatorial affairs at the arthur ross gallery, penn nursing to launch online master’s degree program in nursing and healthcare leadership in summer 2025, leonard bachman, anesthesiology, michael cohen, physics & astronomy, matthew hoyt, engineering graduate student, trustees meeting: july 31, penn professional staff assembly 2024-2025, stephanie acquaye: 2024-2026 jonas scholar, deborah becker: nln fellow, 2024 cohort of penn fellows, five penn vet students: akc outreach scholarships, penn aitech distributes almost $2.6 million in research grants, two new exhibits at the institute of contemporary art, 2024 milken-penn gse education business plan competition, update: summer at penn, weekly crime reports, penn parking & commuter services moves to penn bookstore, the atlantic now available through penn libraries, giving and volunteer opportunities from the netter center for community partnership.

• August 20, 2024
• vol 71 issue 2

The University of Pennsylvania has announced a $10 million gift from alumnus Alp Ercil, M&T’95, to establish the Penn Climate Sustainability Initiative, which will draw upon Penn’s strengths in interdisciplinary teaching and research to address climate and sustainability from multiple perspectives.

“Penn has promised to lead on the greatest challenges of our time, and climate change may be the greatest challenge of all,” said Penn Interim President J. Larry Jameson. “Thanks to the groundbreaking work of Penn researchers and scientists, we are already seeing amazing breakthroughs. We are tremendously grateful to Alp Ercil for his inspirational commitment, which will allow us to accelerate our efforts. We will draw on our collective strengths in climate science and policy to advance our understanding of these challenges and discover solutions that will make a difference around the world.”

Building on Penn’s leadership in fostering collaboration across academic disciplines, the Climate Sustainability Initiative will create a unique university-wide initiative that brings together all 12 schools on campus, as well as interdisciplinary programs like the Kleinman Center for Energy Policy, the Environmental Innovations Initiative, and the Center for Science, Sustainability, and the media.

The Penn Climate Sustainability Initiative will also accelerate the campus-wide Climate and Sustainability Action Plan and enhance Penn’s contribution to the global policy debate.  

“Penn has the key pieces in place to make a significant contribution to the urgent issue of climate change,” said Mr. Ercil. “I am thrilled to help advance this work, accelerate innovation, and strengthen Penn’s role at the forefront of this field.”

Leading on climate change is one of the key priorities of In Principle and Practice, Penn’s strategic framework. The University’s commitment to this issue is broad, ranging from leading in energy science and policy to designing and caring for the built environment. To realize these goals, Penn will support and recruit the best minds in the field, fuel initiatives that advance knowledge and promise solutions, and adopt institutional best practices for the sake of the future of the planet.   

Mr. Ercil’s commitment will serve as a catalyst for this work, providing needed funds for priority initiatives to be determined in partnership among Interim President Jameson, Provost John L. Jackson Jr., and a soon-to-be appointed Vice Provost for Climate Science, Policy, and Action.

“This support from Alp Ercil comes at the perfect time, as we implement our strategic framework and prepare to introduce the new Vice Provost for Climate Science, Policy, and Action,” said Provost Jackson. “The Penn Climate Sustainability Initiative will advance Penn’s strengths in this critical field by accelerating interdisciplinary connections and building collaborations on our campus and beyond.”

Mr. Ercil is the founder and chief investment officer of Asia Research and Capital Management, Ltd., a Hong Kong and Dubai-based investment management firm founded in 2011. He is a 1995 graduate of Penn’s management & technology (M&T) program, a dual-degree program in which he earned a BS in economics from Wharton and a BS in systems engineering from Penn Engineering. An active Penn volunteer, Mr. Ercil is a current member of the Penn Asia Leadership Committee and an emeritus member of Undergraduate Financial Aid Leadership Council (UFLC). He also participates in the Alumni Ambassador Program. His past gifts to Penn have supported the Ercil Endowed Scholarship, the M&T Integration Lab, and the UFLC Challenge Fund.

Andrew M. Hoffman, the Gilbert S. Kahn Dean of Penn Vet, has named Kotaro Sasaki the Richard King Mellon Associate Professor of Biomedical Sciences.

Dr. Sasaki’s research is focused on the development and pathophysiology of urogenital and reproductive organ systems, and his laboratory is working on advancing the understanding of human infertility, reproduction, and endocrinology. Dr. Sasaki possesses an exceptional record of academic accomplishments. His work on converting stem cells into male germ cells and understanding how the human body generates spermatozoa was awarded an Open Philanthropy grant of $2,585,990 in addition to grants from the NIH and other funding agencies. Dr. Sasaki is a recipient of the Endocrine Society’s 2023 Early Investigator Award, which supports early-career investigators in endocrine-related research; the 2023 Zoetis Award for Veterinary Research Excellence; and the 2023 ENS@T Award for best scientific work in the field of adrenal tumors.

“Dr. Sasaki is transforming our understanding of the development and diseases of reproductive and adrenal organs by integrating meticulous comparative physiology with highly creative, pioneering approaches using stem cell-derived organoid models,” said Christopher J. Lengner, the Harriet Ellison Woodward Associate Professor and chair of Penn Vet’s department of biomedical sciences. “His scholarly contributions and novel insights are not only addressing fundamental questions regarding germ cell and adrenal biology, but they are also providing a foundation for the development of novel therapeutic approaches.”

Dr. Sasaki earned his MD from Hokkaido University Graduate School of Medicine and his PhD from Kyoto University Graduate School of Medicine, both in Japan. He completed his surgical pathology residency at the University of Pittsburgh Medical Center and a renal pathology fellowship at the University of Washington Medical Center. After completing his clinical training, Dr. Sasaki pursued a postdoctoral fellowship at Kyoto University before joining Penn Vet’s faculty as an assistant professor in 2018.

The awarding of a named, endowed professorship is the highest honor bestowed upon a faculty member at the University of Pennsylvania and reflects a commitment to scientific discovery, mentorship, and academic service.

Marlyse Baptista: President’s Distinguished Professor of Linguistics

Andrew Santiago-Frangos: M. Jane Williams and Valerie Vargo Presidential Assistant Professor of Biology

The professorship was established through generous planned gifts from the estates of M. Jane Williams, CW’65, and Valerie L. Vargo, MT’65, who forged a lifelong friendship as undergraduate classmates at Penn. Ms. Williams received a BA in history from Penn and an MEd and MBA from Temple University. She pursued a 50-year career as a fundraising professional, holding senior positions at prominent institutions, including as assistant vice president for development and alumni relations at Penn and vice president for development at New York University Medical Center. She served on the Trustees’ Council of Penn Women and supported many other priorities at Penn.

Ms. Vargo graduated from Penn with a degree in medical technology and earned a graduate degree at Temple University. Her medical and microbiology background took her across the country during her career, including at a veteran’s hospital in California and with the quality assurance division of American Home Products. Her career culminated in an extended international assignment in Paris, France. After retirement, she earned real estate credentials and worked for Berger Realty in Ocean City, New Jersey.

In addition to the professorship, Ms. Williams’ and Ms. Vargo’s estate gifts support the Mary Jane Williams and Valerie Vargo AFCRI Breast Cancer Research Fund, the Mary Jane Williams and Valerie Vargo Epilepsy Fund, and the Valerie Vargo and Mary Jane Williams Fund for the Rena Rowan Breast Center at the Perelman School of Medicine.

Doris Wagner: DiMaura Professor of Biology

Dr. Wagner is committed to science education, undergraduate research, and innovation in teaching, participating annually in the Biomedical Research Academy for high school students and leading several workshops at Penn’s Center for Excellence in Teaching, Learning, and Innovation. In addition to her service as graduate chair of biology, she has served on the Penn Women’s Biomedical Society, the Penn Epigenetics Program Executive Board, the Penn Genome Frontiers Institute Executive Board, the University Genomic Initiative Committee, and the University Graduate Council. Additionally, she has served on two committees of Penn Arts & Sciences, Curriculum and Personnel.

Paul W. DiMaura, C’65, and Karen DiMaura established the DiMaura Professorship. Their efforts to promote conservation biology at Penn also include undergraduate scholarship support and research internships for the next generation of ecologists.

An accomplished curator and lecturer, Ms. Zimmerman joined the Arthur Ross Gallery in 2022 as its assistant director. Since then, she has advanced a program that champions critical perspectives and community engagement—values encapsulated in the exhibitions she has curated, Songs of Ritual and Remembrance in 2023, and in Barbara Earl Thomas: The Illuminated Body in 2024, which saw the formation of the gallery’s first community advisory group. Ms. Zimmerman facilitated the gallery’s first landmark grant of $240,000 from the Pew Center for Arts & Heritage for Barbara Earl Thomas: The Illuminated Body , which enabled the gallery’s first high-level collaboration with Penn Live Arts in the presentation of Seth Parker Wood’s Difficult Grace . She has taught graduate seminars on exhibition design and interdisciplinary practices at the University of Washington, and has regularly taught an undergraduate seminar on “Curating Contemporary Art” for University of Washington and for the department of the history of art in Penn’s School of Arts & Sciences.

“I am thrilled to further the Arthur Ross Gallery’s expansive mission for artistic and scholarly inquiry,” Ms. Zimmerman said. “As a champion for multidisciplinary programming, community engagement, embodied learning, and institutional collaboration, I am excited to support the gallery’s exhibitions and programs in this new chapter.”

Ms. Zimmerman has curated and co-curated over 50 commissions, solo, and group exhibitions with artists such as Gordon Hall, Pierre Huyghe, Clotilde Jiménez, Guadalupe Maravilla, Kerry Tribe, and Marisa Williamson. She has produced more than 300 performances, festivals, film and lecture series, and symposia. In 2023, she was a co-curator of Out of Sight , a survey of artists working in the Pacific Northwest.

Before coming to Penn, Ms. Zimmerman worked in various curatorial positions largely in university contexts, including the Henry Art Gallery and Jacob Lawrence Gallery at the University of Washington in Seattle, Washington, and at the Experimental Media and Performing Art Center (EMPAC) at Rensselaer Polytechnic Institute in Troy, New York.

She was awarded the Loris Ledis Emerging Curatorial Award (2011), an open space curatorial residency in Busan, Korea (2011), the New Foundation Seattle’s Career Incentive Fund grant (2016), a Banff Literary Arts residency (2016), and a Curatorial Digital Leadership Fellowship from the Association of Art Museum Curators (2023). She writes for BOMB Magazine , and has served as a panelist and reviewer for the National Endowment for the Arts, Creative Capital, the New York State Council on the Arts, and the Herb Alpert Awards, among others. Ms. Zimmerman is a graduate of the Center for Curatorial Studies of Bard College in Annandale-on-Hudson, New York with an MA in curatorial studies, and of New York University with a BA in visual studies.

Since its founding over forty years ago, the Arthur Ross Gallery, located in the historic Fisher Fine Arts Library Building, has been a space where meaningful programming, resources, and education converge, and where critical and creative expression are considered through the lens of class, gender, history, politics, and race—a dynamic exchange between the University and the public.

Penn Nursing has announced that it will launch a new online nursing and healthcare leadership master’s (MSN) program beginning in the summer of 2025. This innovative 10-credit unit (CU) program, which combines and enhances the curriculum of the nursing and healthcare administration (NADM) and health leadership (HLMP) master’s programs, will provide students with a comprehensive and dynamic learning experience that prepares graduates for leadership roles in the ever-changing healthcare environment.  

“We’re thrilled to be able to offer our students a new leadership program in an online format to meet the needs of busy nursing professionals,” said program director Meghan Fitzpatrick. “And by streamlining the curriculum to 10 CUs, we’re able to make the program more cost-effective for our students.”

In addition to providing students with a more efficient and cost-effective path to earning their MSN, the curricular changes include 500 field hours and exceed the standards set forth in the American Association of Colleges of Nursing’s Level 2 Essentials.

To apply or learn more about the program, please visit its website and register for an upcoming information session .

Born in Baltimore, Dr. Bachman was an Eagle Scout and star wrestler in high school and college. After graduating, Dr. Bachman joined the U.S. Navy’s college training program for officers and earned a bachelor’s degree in chemistry at Franklin and Marshall College in Lancaster, Pennsylvania during World War II. He then went on to earn his MD from the University of Maryland in 1949. He served in Navy hospitals in Maryland and Massachusetts and at medical centers in Boston. After postdoctoral work at Johns Hopkins University, he was recruited to CHOP as chief of anesthesiology in 1955. At the same time, he joined Penn’s School of Medicine as an assistant professor of anesthesiology. He became an associate professor in 1961 and a full professor in 1966. While at CHOP, Dr. Bachman helped develop a pediatric intensive care unit and created groundbreaking tools and technology for anesthesiologists.

Dr. Bachman left Penn in 1973 to become director of health services for Pennsylvania Governor Milton Shapp, and from 1975 to 1979, he served as the secretary of health for Pennsylvania. During his tenure, he confronted Legionnaires’ disease, Hurricane Agnes, swine flu, and dozens of health policy controversies. He also created state-funded healthcare centers and championed access to health services and the public’s role in planning and procedures. In 1979, he was appointed to the U.S. Public Health Service (PHS), where he was named a rear admiral in the commissioned corps and placed in charge of PHS hospitals, clinics, medical disaster response teams, environmental and drug addiction initiatives, and other national health programs. He retired in 1994, but continued to serve for more than a decade as a medical consultant to the U.S. Marshals Service.

Dr. Bachman also taught at George Washington University’s school of medicine and elsewhere, and earned three honorary college degrees. He served as president of the Pennsylvania Society of Anesthesiologists and was active with a dozen other professional organizations. He won the 1990 Abigail Geisinger Medal from the Geisinger Health Foundation, the 2004 Robert M. Smith Award from the American Academy of Pediatrics, and the 2018 Albert Nelson Marquis Lifetime Achievement Award, among other awards. He served on boards and committees for his synagogues in Philadelphia and Washington and was a member of the Society Hill Civic Association.

Dr. Bachman is survived by his children, Emily, Joseph, Daniel, and Jacob; seven grandchildren; seven great-grandchildren; and other relatives.  

Donations in his name may be made to Rangeley Health and Wellness, Box 722, Rangeley, Maine 04970; and Tifereth Israel Congregation, 7701 16th St., NW Washington, D.C. 20012.

Born in Manhattan, New York, Dr. Cohen attended Horace Mann School and then Cornell University, where he was a member of Telluride House and the team that won the 1951 William Lowell Putnam Mathematical Competition. After graduating Phi Beta Kappa with a BS in physics in 1951, he enrolled in the graduate program in physics at the California Institute of Technology. At CalTech, Dr. Cohen researched the behavior of liquid helium under famous physicist Richard Feynman. Dr. Feynman was notoriously picky about graduate students, and Dr. Cohen was one of only 30 trainees Dr. Feynman took on throughout his career. In an interview with the American Institute of Physics, Dr. Feynman remembered how he’d given up on a particular set of calculations because he’d decided they were “too hard.” However, he recalled that Dr. Cohen “found they weren’t as hard as I thought” and cracked them.

Dr. Cohen earned his PhD in 1956 from CalTech, then stayed on to complete a postdoctoral fellowship with Dr. Feynman. On the strength of his mentor’s recommendation, Dr. Cohen then did a second postdoc at the Institute for Advanced Study in Princeton with J. Robert Oppenheimer, father of the atomic bomb. Then, heeding the counsel of “Oppie,” he came to Penn in 1958 as an assistant professor of physics. He became an associate professor two years later and a full professor in 1973.

Dr. Cohen spent the rest of his career at Penn. A condensed matter physicist, he studied the quantum mechanics of liquid helium, as well as ferroelectrics and phospholipid membranes. He enjoyed leading a problem-solving seminar for graduate students preparing for the PhD qualifying exam; for this work, he jokingly described himself as “the department’s Stanley Kaplan.” He also reveled in campus politics, serving as a longtime member of Penn’s faculty senate.

In 1962, with George Stranahan and Robert Craig, Dr. Cohen co-founded the Aspen Center for Physics in Aspen, Colorado. According to The New York Times, the center has “proved pivotal in the development of the Fermi National Accelerator Laboratory, for a long time the world’s most powerful particle accelerator, and the formulation of string theory, regarded by many physicists as the most promising candidate for a ‘theory of everything’ that would explain all the universe’s physical phenomena.” When the center became an independent nonprofit in 1968, Dr. Cohen was elected its first treasurer. He followed this with a term as the center’s vice president, and then, for another 48 years, as an honorary trustee.

In retirement, Dr. Cohen wrote an introductory textbook in classical mechanics, which is available for free here .

Dr. Cohen is survived by his sister, Vera Gottlieb; his three children, Adam (C’90) (Mary), Jonathan, and Alison (Nurit Bloom); his seven grandchildren, Will, Theo, Leah, Aiden, Naomi, Vivi, and Daph; and his caregiver, Jeanette Edwards.

Donations in Dr. Cohen’s memory may be made to the Aspen Center for Physics . If you choose to give, you can notify Dr. Cohen’s family of the donation by clicking the email notification box and entering [email protected] .

Mr. Hoyt, who grew up in Mount Lebanon, Pennsylvania, obtained a master of accounting degree from Brigham Young University in 2006. One of his professors nominated him for the Postgraduate Technical Assistant Program with the Financial Accounting Standards Board, which took Mr. Hoyt across the country. Mr. Hoyt then held roles as a senior associate at KPMG LLP and an associate director at UBS Investment Bank before ultimately working as a senior accounting manager, specializing in accounting policy, for PNC.

A love of computer programming eventually led Mr. Hoyt to pursue a second master’s degree in computer and information technology from Penn Engineering’s department of computer and information science, starting in 2022. He was working towards this degree at the time of his death.

Mr. Hoyt is survived by his wife, Lillian Hoyt; his mother, Phyllis Deborah Hoyt; his four children, Jackson, Elise, Andrew, and Charlotte; and his siblings, Brooke (Jason) Mayhall, Jason (Kjerstin) Hoyt, BJ Hoyt, and Shannon (Tim) Dickman.

Donations to Mr. Hoyt’s family can be made here .

To Report A Death

Almanac appreciates being informed of the deaths of current and former faculty and staff members, students and other members of the University community. Call (215) 898-5274 or email [email protected] .

However, notices of alumni deaths should be directed to the Alumni Records Office at Suite 300, 2929 Walnut St., (215) 8988136 or email [email protected] .

A meeting of the executive committee of the Board of Trustees was held on July 31, 2024, via Zoom.

Trustees Chair Ramanan Raghavendran presented a resolution to approve the transfer of assets. The Gene Therapy Program (GTP) at Penn Medicine, which is led by James Wilson, the Rose H. Weiss Orphan Disease Center Director’s Professor, has grown rapidly over the past ten years during a time of volatility of biotechnology funding, largely supported by industry-sponsored research funds. The Perelman School of Medicine (PSOM), the Penn Center for Innovation (PCI), and Dr. Wilson have been exploring ways to transition the functions and operations of GTP from Penn Medicine into externally managed entities. This transition will further advance clinical research, while fostering continued gene therapy product development that is better managed by industry. A third-party services company has shown interest in securing the service center functions and a third-party R&D company has shown interest in securing the R&D Product Functions. The resolution was approved.

Interim President J. Larry Jameson presented a resolution to appoint Stephen J. MacCarthy as Interim Vice President for University Communications, effective August 1, 2024. Mr. MacCarthy had served in that role for 12 years and has returned to it while a search is conducted for a new Vice President for University Communications.

We extend our deep appreciation and gratitude to the Penn Professional Staff Assembly (PPSA) board members for their dedication in providing a wide range of valuable resources to full-time staff at Penn. Despite the challenges and transitions our community has collectively experienced leading into and through the last academic year, the PPSA has continued to meet the needs of staff in collaboration with the Division of Human Resources and a multitude of colleagues across campus.  During the 2023-2024 fiscal year, PPSA events drew thousands of registered participants. We are thankful to all our board members who generously contribute their time to this organization, and to the many Penn staff who engage with our events! Visit  ppsa.upenn.edu  to learn more about the PPSA, join our list, and to register for upcoming events for the 2024-2025 academic year.

As we look forward to the year ahead, we are pleased to introduce the new and continuing members of the PPSA board, council & independent committee representatives, and appointed positions.

• —Natalie Dury Green, PPSA Past-Chair

2024-2025 Executive Committee Tri-Chairs

Chair: Tonya Bennett, Director of Educational Technology, Penn Vet Chair-Elect: Dawn Maglicco Deitch, Executive Director, Office of Government and Community Affairs Past Chair: Natalie Dury Green, Director of Operations Master in Law Program, University of Pennsylvania Carey Law School

Members at Large

2023-2025 Term Alisha George, Assistant/Web Editor, Almanac Erin Johansen, Senior Director of Principal Gifts Justin Purohit, Manager Accounting Operations, Office of the Comptroller Xime Trujillo, Senior Research Coordinator, Environmental Innovations Initiative

2024-2026 Term Joseph-James Ahern, Senior Archivist, University Archives Lamesha Brown, Director, College Achievement Program Elona Canaj, Business System Analyst, Penn Vet Monica Jacobe, Director of Advising, Wharton Undergraduate Division

Appointments

LISTSERV Manager: Adam Sherr, Director of Crossfunctional Training, Senior Application Data Analyst, Office of University Registrar Secretary: Dee Patel, Director of Content, Wharton Marketing & Communications Treasurer: Jillian Powell, Director of Budget and Analysis, Provost Administrative Affairs Webmaster: Mayumi Hirtzel, Information Systems and Computing Communications Manager: Andy Maynard, Director of Data Services DAR, University of Pennsylvania Carey Law School

Committee Representatives

Veronica Aplenc Gwendolyn Beetham Samantha Fellman Noemi Fernandez Kris Forrest Tomas Isakowitz Kait Johnstone Justin Knoebel Cynthia Kwan Andy Maynard James McGonigle Christina Rodriguez Bethany Schell Adam Sherr Kathy Tang Xime Trujillo

Ms. Acquaye, a Hillman Scholar in Nursing Innovation, joins a select group of doctoral nursing students chosen for their passion for teaching, academic excellence, and research prowess. As a Jonas Scholar, she will receive financial support, mentorship, and a curriculum tailored to providing students with the learning experiences they need to successfully transition into a faculty role.

Ms. Acquaye joins a diverse group of doctoral nursing students, with over 50% of its 2024-2026 cohort representative of Black, Latino, and other communities of color, ensuring that burgeoning nursing leaders reflect the patient population of their diverse communities. This group of 63 scholars contains a multitude of research interests focused on some of the country’s most pressing challenges, including underserved populations in nursing, mental health, and veterans’ health. Ms. Acquaye’s research focuses on health disparities in breastfeeding and is spervised by Diane Spatz, the Helen M. Shearer Professor of Nutrition and a professor of perinatal nursing in the department of family and community health.

Fellows have made enduring and substantial contributions to nursing education as teachers, mentors, scholars, public policy advocates, practice partners, and administrators. They provide visionary leadership and are recognized for their expertise in nursing education. The induction ceremony will take place during the NLN’s Education Summit 2024 in September in San Antonio, Texas.

“It is an honor to be selected as a fellow of the Academy of Nursing Education,” said Dr. Becker. “This recognition reflects my contributions to advancing nursing’s role through teaching, leadership, creativity, and mentoring exceptional nursing students. I am very excited to work with the esteemed nurse leaders and educators who will be my colleagues in the Academy of Nursing Education.”

Dr. Becker joins the 18th class of fellows, which has now reached 406 members. The fellows are leaders in nursing education who teach in a range of programs across the spectrum of higher education. They are affiliated with top-ranked teaching hospitals, academic institutions, and other organizations committed to advancing the quality of healthcare in the U.S. and globally.

The Academy of Nursing Education review panel undertakes a competitive application process before recommending fellowship candidates to the NLN Board of Governors, the oversight body for the academy. Evaluations consider applicants’ contributions to innovative teaching and/or learning strategies; nursing education research; faculty development activities; academic leadership; promotion of public policy initiatives that advance nursing education; and/or collaborative educational, practice, or community partnerships.

Provost John L. Jackson, Jr. and Vice Provost for Faculty Laura W. Perna have announced the appointment of the sixteenth cohort of Penn Fellows.

The Penn Fellows Program provides leadership development to select Penn faculty in mid-career. Begun in 2009, it includes opportunities to build alliances across the University, meet distinguished academic leaders, think strategically about university governance, and consult with Penn’s senior administrators.

Health Track

Kara Anne Bernstein, the George W. Raiziss Professor II in Biochemistry and Biophysics in the Perelman School of Medicine, focuses her research on proteins that contribute to cancer development and the accurate repair of DNA double-strand breaks, using the budding yeast and mammalian systems.

Kenrick Cato, a professor of clinical informatics in the School of Nursing, focuses his research on using electronic patient data to support decision-making for clinicians, patients, and caregivers and on using and modeling nursing data to optimize the value of nursing in healthcare.

Philip Gehrman, a professor of clinical psychology in the Perelman School of Medicine, focuses his research on insomnia and other sleep disorders in the context of mental health conditions, using a variety of research approaches to understand how sleep and mental health are intertwined.

Priti Lal, a professor of pathology and laboratory medicine in the Perelman School of Medicine, focuses her research on the application of high-throughput technology to gain insights into the biology of human cancers, with focus on urothelial and prostate cancers.

Amol Navathe, a professor of medical ethics and health policy in the Perelman School of Medicine, has expertise in policy analysis and design, the economic behavior of physicians and hospitals, and the application of informatics and predictive analytics to healthcare.

Paul M. Titchenell, an associate professor of physiology in the Perelman School of Medicine, focuses his research on the regulation of metabolism by hormones and nutrients, especially insulin, the master regulator of organismal anabolic metabolism.

Humanities Track

Vaughn A. Booker, the George E. Doty, Jr. & Lee Spelman Doty Presidential Associate Professor of Africana Studies in the School of Arts & Sciences, is a historian of 20th-century African American religions, especially practices of simultaneously (re)making religious and racial identities, communities, and forms of authority.

Ian Fleishman, an associate professor of cinema and media studies in the School of Arts & Sciences, focuses his work on sex and violence and their influence on the evolution of narrative form and its underlying epistemological shift from modernism to postmodernism.

Scott Francis, an associate professor of French and Francophone studies in the School of Arts & Sciences, studies reformation theology, gender and the Querelle des Femmes, alterity, rhetoric, and print culture.

Sarah Guérin, an associate professor of the history of art in the School of Arts & Sciences, focuses her research on the material conditions of medieval art, with an emphasis on the socio-economic circumstances and theological conceits surrounding the production and use of art.

Bakirathi Mani, the Penn Presidential Compact Professor of English in the School of Arts & Sciences, specializes in South Asian American public cultures, particularly how empires in the U.S. and in postcolonial South Asia shape South Asian American racial formations.

Jennifer Morton, the Penn Presidential Compact Professor of Philosophy, focuses her research on the philosophy of action, moral philosophy, the philosophy of education, and political philosophy.

Teemu Ruskola, a professor in the Penn Carey Law School, focuses his research on the study of Chinese law and society in a comparative and global context, with an interest in China’s place and role in the development of social theory.

Jorge Téllez, an associate professor of Spanish and Portuguese in the School of Arts & Sciences, focuses his research on the legacies of colonialism in Latin American cultural production, past and present, with an emphasis on Mexico.

Elly R. Truitt, an associate professor of the history and sociology of science in the School of Arts & Sciences, studies the circulation of scientific objects and natural knowledge throughout central and western Eurasia and north Africa, from antiquity into the early modern period.

Social Science Track

Rachel B. Baker, an associate professor in the policy, organizations, leadership, and systems division in the Graduate School of Education, studies access to and success in higher education, with a focus on students in broad-access institutions.  

Arthur van Benthem, an associate professor of business economics and public policy in the Wharton School, specializes in environmental and energy economics, the unintended consequences of environmental legislation, and the economic efficiency of energy policies.

Sarah Bush, an associate professor of political science in the School of Arts & Sciences, focuses her research on how international actors try to aid democracy, promote women’s representation, and influence elections globally, as well as the politics of climate change.

Ioana E. Marinescu, an associate professor in the School of Social Policy and Practice, focuses her research on wage determination and monopsony power, antitrust law for the labor market, the universal basic income, unemployment insurance, and green jobs.

Xi Song, an associate professor of sociology in the School of Arts & Sciences, focuses her research on statistical, demographic, and computational techniques to understand how patterns of social inequality are created and changed within and across generations.

Allyson Mackey, an associate professor of psychology in the School of Arts & Sciences, studies how changes in the brain give rise to changes in the mind, both as development unfolds and in response to experience.

Ryan Hynd, a professor of mathematics in the School of Arts & Sciences, focuses his research on partial differential equations, especially in mathematical models for fluid mechanics, control theory, finance, and with eigenvalue problems.

E. James Petersson, a professor of chemistry in the School of Arts & Sciences, studies the roles of proteins in the understanding of diverse biological phenomena, especially how proteins fold and change shape, with applications in neuroscience and medicine.

The American Kennel Club (AKC) has awarded five students from Penn’s School of Veterinary Medicine AKC Veterinary Outreach Scholarships. The AKC and the Kennel Club of Philadelphia are supporters of Penn Vet’s AKC Scholarship program.

The scholarships support students affiliated with AKC events and programs who advocate for animal health and medicine. Penn Vet recipients of the AKC Scholarship are:

Christina Capparell, V’26, a 2022 University of Delaware graduate, was a sports medicine summer veterinary intern at Penn Vet’s Working Dog Center (WDC). While at the WDC, Ms. Capparell investigated osteoarthritis incidence in working dog breeds. Before arriving at Penn Vet, she worked as a veterinary technician in Schuylkill County, Pennsylvania.

Robert “Zach” Cochran, V’26, is a 2020 University of North Carolina at Chapel Hill graduate. Before arriving at Penn Vet, Mr. Cochran was a post-baccalaureate researcher at the National Institute of Environment Health Science (NIEHS), a division of the National Institutes of Health that investigates the effects of the environment on human health.

Alaina Duessel, V’26, is a 2020 graduate of Allegheny College, where she majored in environmental science. Ms. Duessel was a veterinary technician in Butler County, Pennsylvania, before arriving at Penn Vet.

Laura Grant, V’26, from Mt. Arlington, New Jersey, is a graduate of the University of Maryland where she majored in animal science. Ms. Grant has a particular interest in the diagnosis, treatment, and health of small animals.

Julianna King, V’26, is a 2021 Ohio State University graduate. Ms. King is a NIH/BI veterinary research intern investigating the potential of canines to detect hemangiosarcoma through scent. She serves as treasurer of the student-run Canine Club and as a Purina student representative.

“The AKC Veterinary Outreach Scholarship is not only a testament to the hard work of these five Penn Vet students, but also a recognition of the potential they possess to make significant contributions to our profession,” said Claire Bruno, assistant dean of admissions and student life at Penn Vet. “I am incredibly proud to count Christina, Zach, Alaina, Laura, and Julianna among our students. Their success reflects the core values of Penn Vet, and I am confident that they will continue to achieve wonderful things.”

Founded in 1884, the AKC is the world’s largest and oldest not-for-profit all-breed canine registry, with over 200 recognized breeds. The AKC is a recognized and trusted expert in breed, health, and training information for all dogs, actively advocates for responsible dog ownership, and is dedicated to advancing dog sports.

The Penn Artificial Intelligence and Technology Collaboratory for Healthy Aging (Penn AITech) at the University of Pennsylvania focuses on identifying, developing, evaluating, commercializing and disseminating innovative technology and artificial intelligence methods and software to support aging. The collaboratory is an initiative involving Penn’s School of Nursing, the Perelman School of Medicine, and other departments across the University of Pennsylvania funded by the National Institute on Aging (NIA), a part of the National Institutes of Health (NIH).

The Collaboratory Pilot Cores invite applications for pilot studies using technology and artificial intelligence (AI) to optimize care management and health outcomes for older Americans, including those with Alzheimer’s Disease and Related Dementias (ADRD) living in their homes independently, and those receiving clinical care or skilled home and community-based services.

The PennAITech pilot program solicits annually pilot studies that develop or test technology and AI to detect risk, predict needs, address disparities, improve access to care, and support decision making for chronic illness management and safe aging in place for older adults with or without ADRD and their caregivers. The pilots selected for funding receive guidance and mentoring from the PennAITech expert team.

In year three, through a competitive national grant review process, eleven applicants from academia, industry and health systems across the United States were selected for funding. The list of awardees selected for PennAITech funding include:

Total Year Three Awards: $2,583,609

• Pilot 1: Improved Algorithms for Wearable, Passive, Noninvasive BP Monitoring for Seniors (Investigators: Xina Quan and Keith C. Drake, PyrAmes)
• Pilot 2:  AI-powered Web Application to Analyze Knee Joint Space for Aging Population (Investigator: Soheyla Amirian, University of Georgia)
• Pilot 3: Task-Oriented Multimodal Conversational AI for Assisting Seniors with Daily Tasks (Investigator: Rui Zhang, Penn State University)
• Pilot 4:  Mobile Technology as a Cognitive Biomarker of Alzheimer’s Disease (Investigator:  Chun Lim, Beth Israel Deaconess Medical Center)
• Pilot 5:  Building Deep Digital Twins for Prediction of AD/ADR/MCI in Older Adults (Investigator: Mohammad H. Mahoor, DreamFace Technologies, LLC)
• Pilot 6:   Aliviado Dementia Care Machine Learning Algorithm Development for Caregiving (Investigator: Ab Brody, RN, FAAN, New York University)
• Pilot 7:  AI/ML Analyses of Mobility Changes Among Elderly Using Continuous Gait Data (Investigator: Nicholas Kalaitzandonakes, Foresite Healthcare)
• Pilot 8:  Developing a Home Cognitive Vital Sign to Detect Cognitive Changes AD (Investigator: Daniel Press, Beth Israel Deaconess Medical Center)
• Pilot 9:  Motor Function Assessment for Mild Cognitive Impairment, Frailty, and Fall Risk (Investigator: Trent M. Guess, University of Missouri)
• Pilot 10:  Detecting Cognitive Impairment Using Large Language Models from Speech (Investigator: Hualou Liang, Drexel University)
• Pilot 11:  MUSICARE-VR: Music Intervention with Virtual Reality for Alzheimer’s Care (Investigator: Xiaopeng Zhao, University of Tennessee, Knoxville)

“As our portfolio of funded projects continues to grow, we are excited about the potential of these new solutions to advance ways to support older adults and significantly improve the aging experience in the coming years,” said George Demiris, a Penn Integrates Knowledge Professor with joint faculty appointments in Penn Nursing’s department of biobehavioral health sciences and in the department of biostatistics, epidemiology, and informatics in Penn’s Perelman School of Medicine, and one of the principal investigators of PennAITech. “Our team is excited about these new collaborations and looking forward to supporting the new cohort of awardees.”

Jason Karlawish, a professor of medicine, medical ethics and health policy, and neurology, co-director of the Penn Memory Center and associate director of the Alzheimer’s Disease Research Center in the Perelman School of Medicine, and co-principal investigator of PennAITech, added, “PennAITech offers a nurturing environment for the implementation and evaluation of groundbreaking technologies and innovative approaches to aging. We are looking forward to providing our support to this group of awardees as they advance the development of their innovative solutions.”

Joanna Piotrowska: Unseeing Eyes, Restless Bodies Through December 10

This presentation marks the first U.S. solo museum exhibition dedicated to Joanna Piotrowska (b. 1985), a Polish artist based in London whose work examines the human condition through performative acts, photography, and film. Self-defense manuals and psychotherapeutic methods are used as reference points as Ms. Piotrowska explores the complex roles that play out in everyday life. The exhibition features large-scale, silver gelatin prints of subjects that probe human behavior and the dynamics of domestic relations, exploring intimacy, violence, control, and self-protection with an emphasis on gesture and touch. Throughout the galleries, the artist creates a space with domestic references from which contrasting image placement and content create an uncanny experience that reveals moments of care as well as hierarchies of power.

Joanna Piotrowska: Unseeing Eyes, Restless Bodies is curated by Hallie Ringle, the Daniel and Brett Sundheim Chief Curator.

Where I Learned to Look: Art from the Yard Through December 10

This exhibition celebrates the foundational role of yards in shaping contemporary art in America. Building upon existing scholarship on yard art, artwork created to exist in the transitional space between the home and wider world, artist and art historian Josh T Franco examines the lineage of this robust American art form, which has historically existed outside of museum and gallery spaces. Featuring over 30 works, the exhibition spotlights both community- and academically-taught artists over the past five decades including David Driskell, vanessa german, Donald Judd, Noah Purifoy, and Finnegan Shannon, revealing connections across communities in creative world-building with what is available. This exhibition is part of ICA’s Sachs Guest Curator Program, which since 2007 has funded artists and interdisciplinary creatives to curate ambitious contemporary art presentations and actualize projects that leverage the space of resources of ICA to examine emerging and underrecognized creative practices.

Where I Learned to Look: Art from the Yard is curated by Josh T Franco, the Sachs Guest Curator, in collaboration with Hallie Ringle, the Daniel and Brett Sundheim Chief Curator, with support from Denise Ryner, the Andrea B. Laporte Curator.

The 2024 Milken-Penn GSE EBPC finalists will present their pitches on September 10 in New York City as part of HolonIQ’s Back to School Summit. 

The finalists are Games & Learning, Hilight, Honest Game, Saturday Art Class, SAT IT Labs, Start Lighthouse, and trubel&co.

This year’s finalists use artificial intelligence, video games, visual arts, and cutting edge technology to promote literacy, social-emotional learning, college access, and more. 

Attendees can watch the final pitches, Q&A with judges, and vote in real-time for the Audience Choice Prize winner. They can network with education entrepreneurs and edtech investors, and gain insights from industry leaders.

Registration for the Milken-Penn GSE EBPC finals is free, but space is limited. Visit https://www.educationcompetition.org/finals/ to register. 

Fitness & Learning

8/25      Sunday Reset with Hava Rose ; explore the art of journaling as a meditative practice in a workshop that will jump-start your meditation and creative practices; 2-4 p.m.; ICA; register: https://www.eventbrite.com/e/991391989127?aff=oddtdtcreator (Institute of Contemporary Art).

College of Liberal & Professional Studies

Online webinars. Info and to register: https://www.lps.upenn.edu/about/events .

8/24      Global Master of Public Administration Virtual Information Session ; 10 a.m.

Morris Arboretum & Gardens

In-person events at Morris Arboretum & Gardens. Info and to register: https://www.morrisarboretum.org/see-do/events-calendar .

8/25      Peppers & Peaches Tasting ; sample some peaches and summer herbs and hear tips from produce suppliers on how best to store and cook your stone fruits; 11 a.m.

Readings & Signings

8/22      Book Launch: Biennial Boom: Making Contemporary Art Global ; Paloma Checa-Gismero, Swarthmore College; 6 p.m.; ICA; RSVP: https://tinyurl.com/checa-gismero-aug-22 (Annenberg School for Communication).

8/24      NSO Speakeasy Open Mic Night ; features performances by the Class of 2028; no need to sign up ahead of time—just show up with your work, ready to share your talents with your classmates; 9:30 p.m.; Arts Café, Kelly Writers House (Kelly Writers House).

Special Events

8/21      Later @ ICA with Heyday Athletic ; us for an evening of art, games, cocktails, and light snacks at ICA’s newly launched monthly after-hours night; 6-9 p.m.; ICA; register for cornhole tournament: https://icaphila.org/events/later-ica-with-heyday-athletic/ (Institute of Contemporary Art).

8/21      Programmable Strain-responsive Biopolymer Networks Adapt to High Magnitudes of Mechanical Loading ; Yan Luo, mechanical engineering & applied mechanics; 10:15 a.m.; room 337, Towne Building (Mechanical Engineering & Applied Mechanics).

8/26      Decoding Opioid Receptor Antagonism in the Context of Cellular Signaling Dynamics ; Cornelius Gati, University of Southern California; 11 a.m.; Gaulton Auditorium, BRB (Biomedical Graduate Studies).

This is an update to the Summer AT PENN calendar , which is online now. The September AT PENN calendar will be published next Tuesday, August 27. To include events in a future AT PENN calendar or weekly update, send the salient details to [email protected] .

Division of Public Safety University of Pennsylvania Police Department Crime Report

About the Crime Report: Below are the Crimes Against Persons and/or Crimes Against Property from the campus report for August 5-11, 2024 . The Crime Reports are available at: https://almanac.upenn.edu/sections/crimes . Prior weeks’ reports are also online. –Eds.

This summary is prepared by the Division of Public Safety (DPS) and contains all criminal incidents reported and made known to the Penn Police, including those reported to the Philadelphia Police Department (PPD) that occurred within our patrol zone, for the dates of August 5-11, 2024 . The Penn Police actively patrol from Market Street to Baltimore Avenue and from 30 th Street to 43 rd Street in conjunction with the Philadelphia Police.

In this effort to provide you with a thorough and accurate report on public safety concerns, we hope that your increased awareness will lessen the opportunity for crime. For any concerns or suggestions regarding this report, please call DPS at (215) 898-7297. You may view the daily crime log on the DPS website .

Penn Police Patrol Zone

Market Street to Baltimore Avenue and from 30 th Street to 43 rd Street

Philadelphia Police 18th District

Schuylkill River to 49th Street & Market Street to Woodland Avenue

Below are the Crimes Against Persons from the 18th District: 11 incidents were reported for August 5-11, 2024 by the 18 th District, covering the Schuylkill River to 49th Street & Market Street to Woodland Avenue.

The Division of Public Safety offers resources and support to the Penn community. DPS developed a few helpful risk reduction strategies outlined below. Know that it is never the fault of the person impacted (victim/survivor) by crime.

• See something concerning? Connect with Penn Public Safety 24/7 at (215) 573-3333.
• Worried about a friend’s or colleague’s mental or physical health? Get 24/7 connection to appropriate resources at (215) 898-HELP (4357).
• Seeking support after experiencing a crime? Call Special Services - Support and Advocacy resources at (215) 898-4481 or email an advocate at [email protected]
• Use the Walking Escort and Riding services available to you free of charge.
• Take a moment to update your cellphone information for the UPennAlert Emergency Notification System
• Download the Penn Guardian App which can help Police better find your location when you call in an emergency.
• Access free self-empowerment and defense courses through Penn DPS.
• Stay alert and reduce distractions; using cellphones, ear buds, etc. may limit your awareness.
• Orient yourself to your surroundings. (Identify your location, nearby exits, etc.)
• Keep your valuables out of sight and only carry necessary documents.

Penn Parking & Commuter Services has moved to the first floor of the Penn Bookstore (near the Sansom Street entrance).

Operations began on Tuesday, July 30 at the new location, where the team assists the University community with its parking and commuting needs in an expanded space. The location is open weekdays, 8:30 a.m. until 5 p.m.

The move from 3401 Walnut, the department’s home of nearly 30 years, coincides with the launch of an expanded menu of flexible permits and programs for new parkers, which are being offered based on community feedback.

Parking & Commuter Services joins the PennCard Center and Onboard@Penn at the bookstore, solidifying the site as an accessible one-stop hub for a variety of Penn services.

Keep up with Penn Parking & Commuter Services at the department’s streamlined website .

Online full-text access to The Atlantic has been a perennial request of Penn Libraries. The magazine has a long, distinguished history as a cultural reporter and opinion-maker since its start in 1857 as a showpiece for Boston literati. Faculty in the political science department and other Penn academic programs frequently include Atlantic articles in their course reserve lists, and diligent students often report frustration over the website’s metered paywall access. Additionally, title changes over the years have made The Atlantic one of the more difficult items to find in the Penn Libraries catalog.

The Penn Libraries’  Atlantic  website subscription  provides web-only content and print-magazine content. Faculty can now easily share URLs to specific articles with students, and all students, faculty, and staff can enjoy everything The Atlantic has to offer, from cultural commentary to  the Caleb’s Inferno crossword . Currently, the subscription does not include  The Atlantic ’s mobile app.

Additionally, PDF versions of whole monthly issues (advertisements included) are available for download from the latest issue back to the first issue published in November 1857. While some of this content is currently available through Nexis Uni and Factiva, the new Atlantic website subscription provides images and publisher’s formatting. That said, readers interested in discovering and viewing specific articles in older issues of  The Atlantic  may still find it easier to use Penn Libraries’ searchable full text subscription to  The Atlantic Magazine Archive, covering 1857 through 2014.

How To Access

Accessing  The Atlantic  online is easy.

• Visit the Sign In page from anywhere on  theatlantic.com .
• Click on “Sign in through your institution.”  Do not create a personal account or sign in using the Facebook or Google options.
• When prompted, type University of Pennsylvania where it asks you to enter your institution name and click “Continue.”
• Enter your PennKey when prompted.
• Enjoy  The Atlantic.

Dear Penn Community,

Thank you for your spirit of volunteerism. Many benefit from your willingness to share. We receive many expressions of gratitude from community members and agencies with whom we partner. The Penn community continues to work towards being good neighbors in our shared community.  We thank you for your overwhelming support and for your generosity.

We are pleased to report that the Penn VIPS Change Drive collected approximately $500 for the MK Bogle Scholarship Program, which supports graduating high school students with a history of performing community service and who have been accepted at an accredited college or university. This sum was added to the many donations from our sponsors. We thank all our sponsors.

Please also see below for a list of different volunteer activities, both on and off campus. Let us help you volunteer.

The following volunteer activities are available to the Penn community:

August 7–August 21 School Supplies Drive

Don’t forget to collect school supplies for the annual Penn Volunteers in Public Service (VIPS) school supplies drive. Donations are shared with West and Southwest Philadelphia public schools involved in the University Assisted Community (Sayre, Lea, Comegy’s West, for example), as well as students from Mastery Charter School. We also receive requests for items from local shelters, day care centers, and directly from families.

Support school children by providing books, pens, pencils, book bags, calculators, crayons, rulers, dictionaries, elementary school story books and other items children need to help them be successful in school.  Below is a complete list of suggested items for donation: Agendas or planners, backpacks, binder dividers, small binders, feminine products, hand sanitizer, hygiene products, stickers, paper towels, highlighters in different colors, tissues, pencils, erasers, glue, glue sticks, lined paper/notebooks (hard and spiral), three-ring binders, three-hole punches, loose-leaf paper or spiral notebooks, subject dividers, index cards, folders, blue and black pens, mechanical pencils, pencil pouches, rulers, tape, reams of paper for duplicating, scissors, books (fiction/nonfiction), and certificates and other incentives.

The following is a sample of the areas where you can conveniently drop your donations:

Become a Mentor in the Penn Workplace Mentoring Program

Encourage 7th graders to do well in school. Talk to them about the importance of college, share your area of expertise in your job with them, and help them to think about their futures. Make a difference in the life of a young person.

 Mentors meet with students once a month from September to May. All sessions are held on Penn’s campus. Training is held in September.

Teach at the Nonprofit Institute sponsored by the Netter Center

Have a special knowledge on advisory boards, grant writing, risk management, strategic planning, etc.? Want to teach members of the surrounding community how to more effectively manage/create their nonprofits?

The Nonprofit Institute, a five-day program offering a variety of classes designed to help start-up nonprofits gain important skills needed to create a successful organization. Classes range from 1.5 hours to 3 hours. The institute is held twice a year, in the fall and spring.

Teach at the University Assisted Community School (UACS Nights)

Have a special talent? Want to teach it to members of the surrounding community? Do so through our exciting program called University Assisted Community Schools Nights. Teach adult learners your expertise in areas such as resume writing, interview skills, computers, professional development, dance, cooking, and/or a subject you are passionate about.  Teach once a week for a one- or two-hour period for four to six weeks. We also welcome classes that can be taught in a single two-hour session. Classes are normally held from 6–8 p.m. on Tuesday and Thursday evenings.

Adopt A Classroom

An exciting opportunity for you and your colleagues to “adopt” a Philadelphia school classroom and help teachers with needed supplies.

Provide needed classroom items like reams of paper, pens, pencils, tissues, hand sanitizer, notebooks, folders, glue sticks, disinfecting wipes, calculators, index cards, scissors, backpacks, pencil sharpeners, dividers, protractors, highlighters, markers, construction paper, book covers, combination locks, personal organizers, Post-It notes, tape, and staplers and staples.

Work with classrooms involved in community schools operated by the Netter Center for Community Partnerships. Schools include Lea, Sayre, West, Hamilton, Comegys, and more. You would have the opportunity to select the age group you prefer. A classroom would be assigned to you and a wish-list provided.

You and your colleagues can spend the summer collecting the supplies. Arrangements will be made in September for you to make your donations to your adopted class.

Dropsite Volunteers

Become a dropsite volunteer and participate in the various drives held throughout the course of the year. Assist with collecting donated items that are shared with a variety of agencies in the community. 

Penn VIPS provides the collected donations to local agencies and schools, which makes a huge difference to members of the surrounding community.

Drives take place as follows:

• March –Change Drive to Benefit the Scholarship Program
• August –School Supplies Drive
• November –Food Drive
• December –Toy/Gift Drive
• December –New Coat Drive

Dropsite volunteers advertise the various drives, help designate the beneficiaries of the drives, and help with the distribution of the donated items.

Leftover conference bags, tee-shirts, pens, etc.?

Donate them to Penn VIPS. We will share them with school children and members of the community.

Contact Isabel Sampson-Mapp at  [email protected] for additional information about any of these opportunities.

—Isabel Sampson-Mapp, associate director, Netter Center for Community Partnerships

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Introduction

Amount of scholarship or fellowship grant.

Candidate for a degree.

Eligible educational institution.

Qualified education expenses.

Expenses that don't qualify.

Payment for services.

Exceptions.

Worksheet 1-1.

Taxable Scholarships and Fellowship Grants

Form 1040 or 1040-SR.

Form 1040-NR.

Fulbright Grants

Pell grants and other title iv need-based education grants, payment to service academy cadets, veterans' benefits.

Officers, owners, and highly compensated employees.

Child of deceased parents.

Child of divorced parents.

Graduate Education

How to report.

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Overview of the American opportunity credit for 2023.

Can you claim more than one education credit this year?

Differences between the American opportunity and lifetime learning credits.

Form 8862 may be required.

Student qualifications.

Who Can't Claim the Credit?

Academic period.

Paid with borrowed funds.

Student withdraws from class(es).

Related expenses.

Prepaid expenses.

Tax-free educational assistance.

Refunds received in 2023.

Refunds received after 2023 but before your income tax return is filed.

Refunds received after 2023 and after your income tax return is filed.

Credit recapture.

Amounts that don't reduce qualified education expenses.

Coordination with Pell grants and other scholarships.

Sports, games, hobbies, and noncredit courses.

Comprehensive or bundled fees.

Completion of first 4 years.

Enrolled at least half-time.

Expenses paid by dependent.

Expenses paid by you.

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Form 1098-T.

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MAGI when using Form 1040 or 1040-SR.

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Full-time student.

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Overview of the lifetime learning credit for 2023.

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Who is an eligible student.

• Tables and figuresStudent loan interest deductionOverview (Table 4-1)Table 4-1. Student Loan Interest Deduction at a Glance

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Reasonable period of time.

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Related person.

Qualified employer plan.

Adjustments to Qualified Education Expenses

Loan origination fee.

Capitalized interest.

Interest on revolving lines of credit.

Interest on refinanced and consolidated student loans.

Allocating Payments Between Interest and Principal

Don't include as interest, when must interest be paid.

Claiming you as a dependent.

Interest paid by others.

No Double Benefit Allowed

Form 1098-E.

MAGI when using Form 1040-NR.

Which Worksheet To Use

Claiming the deduction.

Private educational lender.

Educational organization described in section 170(b)(1)(A)(ii).

Section 501(c)(3) organization.

Refinanced Loan

Student loan repayment assistance.

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Designated beneficiary.

Contributions to a qualified tuition program (QTP).

Eligible postsecondary school.

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Half-time student.

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When contributions are considered made.

Limit for each designated beneficiary.

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Members of the beneficiary's family.

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Figuring the Taxable Portion of a Distribution

Coordination with american opportunity and lifetime learning credits, coordination with qualified tuition program (qtp) distributions, losses on coverdell esa investments.

Figuring the additional tax.

Exception for Transfer to Surviving Spouse or Family Member

How to figure the taxable earnings, what’s new for 2024.

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How Much Can You Contribute?

Recontribution of refunded amounts.

Earnings and return of investment.

Taxable earnings.

Coordination With Coverdell ESA Distributions

Losses on qtp investments, figuring the amount not subject to the 10% tax, reporting early distributions.

Qualified U.S. savings bonds.

Effect of the Amount of Your Income on the Amount of Your Exclusion

Claiming the exclusion.

Educational assistance program.

Educational assistance benefits.

Qualified education loan.

Benefits over $5,250.

Working condition fringe benefit.

What is the tax benefit of taking a business deduction for work-related education?

Education Required by Employer or by Law

Maintaining skills vs. qualifying for new job.

Education during temporary absence.

Education during indefinite absence.

Certification in a new state.

Bar or CPA Review Course

Teaching and related duties.

Deductible expenses.

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Unclaimed reimbursement.

Temporary basis.

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Cruises and conventions.

50% limit on meals.

Travel as Education

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Self-Employed Persons

Armed forces reservists, performing artists, and fee-basis officials, impairment-related work expenses.

Examples of records to keep.

Preparing and filing your tax return.

Free options for tax preparation.

Using online tools to help prepare your return.

Need someone to prepare your tax return?

Employers can register to use Business Services Online.

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Online tax information in other languages.

Free Over-the-Phone Interpreter (OPI) Service.

Accessibility Helpline available for taxpayers with disabilities.

Getting tax forms and publications.

Getting tax publications and instructions in eBook format.

Access your online account (individual taxpayers only).

Get a transcript of your return.

Tax Pro Account.

Using direct deposit.

Reporting and resolving your tax-related identity theft issues.

Ways to check on the status of your refund.

Making a tax payment.

What if I can’t pay now?

Filing an amended return.

Checking the status of your amended return.

Understanding an IRS notice or letter you’ve received.

Responding to an IRS notice or letter.

Contacting your local TAC.

How Can You Learn About Your Taxpayer Rights?

What can tas do for you, how can you reach tas, how else does tas help taxpayers, low income taxpayer clinics (litcs).

Academic period:

Adjusted qualified education expenses (AQEE):

Candidate for a degree:

Designated beneficiary:

Eligible educational institution:

Eligible student:

Half-time student:

Modified adjusted gross income (MAGI):

Qualified education expenses:

Publication 970 (2023), Tax Benefits for Education

For use in preparing 2023 Returns

Publication 970 - Introductory Material

For the latest information about developments related to Pub. 970, such as legislation enacted after it was published, go to IRS.gov/Pub970 .

Student loan interest deduction. For 2023, the amount of your student loan interest deduction is gradually reduced (phased out) if your MAGI is between $75,000 and $90,000 ($155,000 and $185,000 if you file a joint return). You can’t claim the deduction if your MAGI is $90,000 or more ($185,000 or more if you file a joint return). See chapter 4 .

Education savings bond program. For 2023, the amount of your education savings bond interest exclusion is gradually reduced (phased out) if your MAGI is between $91,850 and $106,850 ($137,800 and $167,800 if you file a joint return). You can't exclude any of the interest if your MAGI is $106,850 or more ($167,800 or more if you file a joint return). See chapter 9 .

Business deduction for work-related education. Generally, if you claim a business deduction for work-related education and you drive your car to and from school, the amount you can deduct for miles driven from January 1, 2023, through December 31, 2023, is 65.5 cents a mile. See chapter 11 .

Form 1098-T, Tuition Statement. When figuring an education credit, use only the amounts you paid and are deemed to have paid during the tax year for qualified education expenses. In most cases, the student should receive Form 1098-T from the eligible educational institution by January 31, 2024. However, the amount on Form 1098-T might be different from the amount you actually paid and are deemed to have paid. In addition, Form 1098-T should give you other information for that institution, such as adjustments made for prior years; the amount of scholarships or grants, reimbursements, or refunds; and whether the student was enrolled at least half-time or was a graduate student. The eligible educational institution may ask for a completed Form W-9S, Request for Student's or Borrower's Taxpayer Identification Number and Certification, or similar statement to obtain the student's name, address, and taxpayer identification number.

Form 1098-T requirement. To be eligible to claim the American opportunity credit or lifetime learning credit, the law requires a taxpayer (or a dependent) to have received Form 1098-T from an eligible educational institution, whether domestic or foreign. However, you may claim a credit if the student doesn't receive Form 1098-T because the student's educational institution isn't required to furnish Form 1098-T to the student under existing rules (for example, if the student is a qualified nonresident alien, has qualified education expenses paid entirely with scholarships, has qualified education expenses paid under a formal billing arrangement, or is enrolled in courses for which no academic credit is awarded). If a student's educational institution isn't required to provide Form 1098-T to the student, you may claim a credit without Form 1098-T if you otherwise qualify, can demonstrate that you (or a dependent) were enrolled at an eligible educational institution, and can substantiate the payment of qualified tuition and related expenses.You may also claim a credit if the student attended an eligible educational institution required to furnish Form 1098-T but the student doesn’t receive Form 1098-T before you file your tax return (for example, if the institution is otherwise required to furnish Form 1098-T and doesn’t furnish it or refuses to do so) and you take the following required steps: After January 31, 2024, but before you file your 2023 tax return, you or the student must request that the educational institution furnish Form 1098-T. You must fully cooperate with the educational institution's efforts to gather the information needed to furnish Form 1098-T. You must also otherwise qualify for the benefit, be able to demonstrate that you (or a dependent) were enrolled at an eligible educational institution, and substantiate the payment of qualified tuition and related expenses.

Educational institution's EIN required. To claim the American opportunity credit, you must provide the educational institution's employer identification number (EIN) on your Form 8863. You should be able to obtain this information from Form 1098-T or the educational institution. See chapter 2 .

Form 8862 may be required. If your American opportunity credit was denied or reduced for any reason other than a math or clerical error for any tax year beginning after 2015, you must attach a completed Form 8862, Information To Claim Certain Credits After Disallowance, to your tax return for the next year for which you claim the credit. See chapter 2 .

Ban on claiming the American opportunity credit. If you claim the American opportunity credit even though you're not eligible, you may be banned from claiming the credit for 2 or 10 years depending on your conduct. See chapter 2 .

Taxpayer identification number (TIN) needed by due date of return. If you haven’t been issued a TIN by the due date of your 2023 return (including extensions), you can't claim the American opportunity credit on either your original or an amended 2023 return. Also, the American opportunity credit isn't allowed on either your original or an amended 2023 return for a student who hasn’t been issued a TIN by the due date of your return (including extensions). See chapter 2 .

Higher education emergency grants. Emergency financial aid grants under the following are not included in your gross income.

The CARES Act.

The Coronavirus Response and Relief Supplemental Appropriations Act, 2021.

The American Rescue Plan Act of 2021.

Also, for purposes of the American opportunity tax credit (see chapter 2) and lifetime learning credit (see chapter 3), a student does not reduce an amount of qualified tuition and related expenses by the amount of an emergency financial aid grant. For more information, see Higher Education Emergency Grants Frequently Asked Questions .

Coordination with Pell grants and other scholarships or fellowship grants. It may benefit you to choose to include otherwise tax-free scholarships or fellowship grants in income. This may increase your education credit and lower your total tax or increase your refund. See Coordination with Pell grants and other scholarships in chapter 2 and chapter 3 .

Student loan interest deduction. You can’t deduct as interest on a student loan any interest paid by your employer after March 27, 2000, and before January 1, 2026, under an educational assistance program. See chapter 4 .

Student loan forgiveness. The American Rescue Plan Act of 2021 modified the treatment of student loan forgiveness for discharges in 2021 through 2025. See chapter 5 .

Achieving a Better Life Experience (ABLE) account. This is a savings account for individuals with disabilities and their families. Distributions are tax free if used to pay the beneficiary's qualified disability expenses, which may include education expenses. For more information, see Pub. 907, Tax Highlights for Persons With Disabilities.

Estimated tax payments. If you have taxable income from any of your education benefits and the payer doesn't withhold enough income tax, you may need to make estimated tax payments. For more information, see Pub. 505, Tax Withholding and Estimated Tax.

Employer-provided educational assistance benefits. Employer-provided educational assistance benefits include payments made after March 27, 2020, and before January 1, 2026, for principal or interest on any qualified education loan you incurred for your education. See chapter 10 .

Miscellaneous itemized deductions. For tax years beginning after 2017 and before 2026, you no longer deduct work-related education expenses as a miscellaneous itemized deduction subject to a 2%-of-adjusted-gross-income floor. See chapter 11 .

Photographs of missing children. The Internal Revenue Service is a proud partner with the National Center for Missing & Exploited Children® (NCMEC) . Photographs of missing children selected by the Center may appear in this publication on pages that would otherwise be blank. You can help bring these children home by looking at the photographs and calling 1-800-THE-LOST (1-800-843-5678) if you recognize a child.

This publication explains tax benefits that may be available to you if you are saving for or paying education costs for yourself or, in many cases, another student who is a member of your immediate family. Most benefits apply only to higher education.

Chapter 1 explains the tax treatment of various types of educational assistance, including scholarships, fellowship grants, and tuition reductions.

Two tax credits for which you may be eligible are explained in chapter 2 and chapter 3 . These benefits, which reduce the amount of income tax you may have to pay, are:

The American opportunity credit, and

The lifetime learning credit.

Nine other types of benefits are explained in chapters 4 through 11. These benefits, which reduce the amount of income tax you may have to pay, are:

Deduct student loan interest;

Receive tax-free treatment of a canceled student loan;

Receive tax-free student loan repayment assistance;

Establish and contribute to a Coverdell education savings account (ESA), which features tax-free earnings;

Participate in a qualified tuition program (QTP), which features tax-free earnings;

Take early distributions from any type of individual retirement arrangement (IRA) for education costs without paying the 10% additional tax on early distributions;

Cash in savings bonds for education costs without having to pay tax on the interest;

Receive tax-free education benefits from your employer; and

Claim a business deduction for work-related education.

You generally can't claim more than one of the benefits described in the list above for the same qualifying education expense.

Some of the features of these benefits are highlighted in the Appendix , later in this publication. This general comparison table may guide you in determining which benefits you may be eligible for and which chapters you may want to read.

After you estimate your education tax benefits for the year, you may be able to reduce the amount of your federal income tax withholding. Also, you may want to recheck your withholding during the year if your personal or financial situation changes. For more information, see Pub. 505.

In this publication, wherever appropriate, we have tried to use the same or similar terminology when referring to the basic components of each education benefit. Some of the terms used are:

Qualified education expenses,

Eligible educational institution, and

Even though the same term, such as qualified education expenses, is used to label a basic component of many of the education benefits, the same expenses aren't necessarily allowed for each benefit. For example, the cost of room and board is a qualified education expense for the QTP, but not for the education savings bond program.

Many of the terms used in the publication are defined in the glossary near the end of the publication. The glossary isn't intended to be a substitute for reading the chapter on a particular education benefit, but it will give you an overview of how certain terms are used in discussing the different benefits.

We welcome your comments about this publication and your suggestions for future editions.

You can send us comments through IRS.gov/FormComments . Or, you can write to the Internal Revenue Service, Tax Forms and Publications, 1111 Constitution Ave. NW, IR-6526, Washington, DC 20224.

Although we can’t respond individually to each comment received, we do appreciate your feedback and will consider your comments and suggestions as we revise our tax forms, instructions, and publications. Don’t send tax questions, tax returns, or payments to the above address.

If you have a tax question not answered by this publication or the How To Get Tax Help section at the end of this publication, go to the IRS Interactive Tax Assistant page at IRS.gov/Help/ITA where you can find topics by using the search feature or viewing the categories listed.

Go to IRS.gov/Forms to download current and prior-year forms, instructions, and publications.

Go to IRS.gov/OrderForms to order current forms, instructions, and publications; call 800-829-3676 to order prior-year forms and instructions. The IRS will process your order for forms and publications as soon as possible. Don’t resubmit requests you’ve already sent us. You can get forms and publications faster online.

Useful Items

Publication

463 Travel, Gift, and Car Expenses

525 Taxable and Nontaxable Income

550 Investment Income and Expenses

590-A Contributions to Individual Retirement Arrangements (IRAs)

590-B Distributions from Individual Retirement Arrangements (IRAs)

Form (and Instructions)

1040 U.S. Individual Income Tax Return

1040-NR U.S. Nonresident Alien Income Tax Return

1040-SR U.S. Tax Return for Seniors

2106 Employee Business Expenses

5329 Additional Taxes on Qualified Plans (Including IRAs) and Other Tax-Favored Accounts

8815 Exclusion of Interest From Series EE and I U.S. Savings Bonds Issued After 1989

8863 Education Credits

See chapter 12 for information about getting these publications and forms.

1. Scholarships, Fellowship Grants, Grants, and Tuition Reductions

Individual retirement arrangements (IRAs). You can set up and make contributions to an IRA if you receive taxable compensation. A scholarship or fellowship grant is generally taxable compensation only if it is shown in box 1 of your Form W-2, Wage and Tax Statement. However, for tax years beginning after 2019, certain non-tuition fellowship and stipend payments not reported to you on Form W-2 are treated as taxable compensation for IRA purposes. These include amounts paid to you to aid you in the pursuit of graduate or postdoctoral study and included in your gross income under the rules discussed in this chapter. Taxable amounts not reported to you on Form W-2 are generally included in gross income as discussed later under Reporting Scholarships and Fellowship Grants . For more information about IRAs, see Pub. 590-A and Pub. 590-B.

Also, for purposes of the American opportunity credit (see chapter 2) and lifetime learning credit (see chapter 3), a student does not reduce an amount of qualified tuition and related expenses by the amount of an emergency financial aid grant. For more information, see Higher Education Emergency Grants Frequently Asked Questions on IRS.gov.

This chapter discusses the income tax treatment of various types of educational assistance you may receive if you are studying, teaching, or researching in the United States. The educational assistance can be for a primary or secondary school, a college or university, or a vocational school. Included are discussions of:

Scholarships;

Fellowship grants;

Need-based education grants, such as a Pell grant; and

Qualified tuition reductions.

Special rules apply to U.S. citizens and resident aliens who have received scholarships or fellowship grants for studying, teaching, or researching abroad. For information about these rules, see Pub. 54, Tax Guide for U.S. Citizens and Resident Aliens Abroad.

Scholarships and Fellowship Grants

A scholarship is generally an amount paid or allowed to, or for the benefit of, a student (whether an undergraduate or a graduate) at an educational institution to aid in the pursuit of their studies.

A fellowship grant is generally an amount paid for the benefit of an individual to aid in the pursuit of study or research.

The amount of a scholarship or fellowship grant includes the following.

The value of contributed services and accommodations. This includes such services and accommodations as room (lodging), board (meals), laundry service, and similar services or accommodations that are received by an individual as a part of a scholarship or fellowship grant.

The amount of tuition, matriculation, and other fees that are paid for or remitted to the student to aid the student in pursuing study or research.

Any amount received in the nature of a family allowance as a part of a scholarship or fellowship grant.

Tax-Free Scholarships and Fellowship Grants

A scholarship or fellowship grant is tax free (excludable from gross income) only if you are a candidate for a degree at an eligible educational institution.

A scholarship or fellowship grant is tax free only to the extent :

It doesn't exceed your qualified education expenses;

It isn't designated or earmarked for other purposes (such as room and board), and doesn't require (by its terms) that it can't be used for qualified education expenses; and

It doesn't represent payment for teaching, research, or other services required as a condition for receiving the scholarship. For exceptions, see Payment for services , later.

Use Worksheet 1-1 to figure the amount of a scholarship or fellowship grant you can exclude from gross income.

You are a candidate for a degree if you:

Attend a primary or secondary school or are pursuing a degree at a college or university; or

Attend an educational institution that:

Provides a program that is acceptable for full credit toward a bachelor's or higher degree, or offers a program of training to prepare students for gainful employment in a recognized occupation; and

Is authorized under federal or state law to provide such a program and is accredited by a nationally recognized accreditation agency.

An eligible educational institution is one whose primary function is the presentation of formal instruction and that normally maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it regularly carries on its educational activities.

For purposes of tax-free scholarships and fellowship grants, these are expenses for:

Tuition and fees required to enroll at or attend an eligible educational institution; and

Course-related expenses, such as fees, books, supplies, and equipment that are required for the courses at the eligible educational institution. These items must be required of all students in your course of instruction.

Qualified education expenses don't include the cost of:

Room and board,

Clerical help, or

Equipment and other expenses that aren't required for enrollment in or attendance at an eligible educational institution.

Generally, you can't exclude from your gross income the part of any scholarship or fellowship grant that represents payment for teaching, research, or other services required as a condition for receiving the scholarship. This applies even if all candidates for a degree must perform the services to receive the degree. However, see Exceptions next.

You don't have to treat as payment for services the part of any scholarship or fellowship grant that represents payment for teaching, research, or other services if you receive the amount under:

The National Health Service Corps Scholarship Program,

The Armed Forces Health Professions Scholarship and Financial Assistance Program, or

A comprehensive student work-learning-service program (as defined in section 448(e) of the Higher Education Act of 1965) operated by a work college (as defined in that section).

You received a scholarship of $2,500. The scholarship wasn't received under any of the exceptions mentioned above. As a condition for receiving the scholarship, you must serve as a part-time teaching assistant. Of the $2,500 scholarship, $1,000 represents payment for teaching. The provider of your scholarship gives you a Form W-2 showing $1,000 as income. Your qualified education expenses were at least $1,500. Assuming that all other conditions are met, the most you can exclude from your gross income is $1,500. The $1,000 you received for teaching must be included in your gross income.

You are a candidate for a degree at a medical school. You receive a scholarship (not under any of the exceptions mentioned above) for your medical education and training. The terms of your scholarship require you to perform future services. A substantial penalty applies if you don't comply. The entire amount of your grant is taxable as payment for services in the year it is received.

Athletic Scholarships

An athletic scholarship is tax free only if and to the extent it meets the requirements discussed earlier.

You can use Worksheet 1-1 to figure the tax-free and taxable parts of your athletic scholarship.

Figuring tax-free and taxable (Worksheet 1-1) Scholarships and fellowship grantsTaxable scholarship and fellowship grant income (Worksheet 1-1) WorksheetsScholarships and fellowship grants (Worksheet 1-1)Worksheet 1-1. Taxable Scholarship and Fellowship Grant Income

If and to the extent your scholarship or fellowship grant doesn't meet the requirements described earlier, it is taxable and must be included in gross income. You can use Worksheet 1-1 to figure the tax-free and taxable parts of your scholarship or fellowship grant.

Reporting Scholarships and Fellowship Grants

Whether you must report your scholarship or fellowship grant depends on whether you must file a return and whether any part of your scholarship or fellowship grant is taxable.

If your only income is a completely tax-free scholarship or fellowship grant, you don't have to file a tax return and no reporting is necessary. If all or part of your scholarship or fellowship grant is taxable and you are required to file a tax return, report the taxable amount as explained below. You must report the taxable amount whether or not you received a Form W-2. If you receive an incorrect Form W-2, ask the payer for a corrected one.

For information on whether you must file a return, see Pub. 501, Dependents, Standard Deduction, and Filing Information, or your income tax form instructions.

How you report any taxable scholarship or fellowship grant income depends on which return you file.

If you file Form 1040 or 1040-SR, include any taxable amount reported to you in box 1 of Form W-2 in the total on line 1a. Include any taxable amount not reported to you in box 1 of Form W-2 on Schedule 1 (Form 1040), line 8r.

If you file Form 1040-NR, report any taxable amount on Schedule 1 (Form 1040), line 8r. Generally, you must report the amount reported to you in box 2 of Form(s) 1042-S, Foreign Person's U.S. Source Income Subject to Withholding. For more information, see the Instructions for Form 1040-NR.

Other Types of Educational Assistance

The following discussions deal with other common types of educational assistance.

A Fulbright grant is generally treated as a scholarship or fellowship grant in figuring how much of the grant is tax free.

These need-based grants are treated as scholarships for purposes of determining their tax treatment. They are tax free to the extent used for qualified education expenses during the period for which a grant is awarded.

An appointment to a U.S. military academy isn't a scholarship or fellowship grant. Payment you receive as a cadet or midshipman at an armed services academy is pay for personal services and will be reported to you in box 1 of Form W-2. Include this pay in your income in the year you receive it.

Payments you receive for education, training, or subsistence under any law administered by the Department of Veterans Affairs (VA) are tax free. Don't include these payments as income on your federal tax return.

If you qualify for one or more of the education tax benefits discussed in chapters 2 through 11, you may have to reduce the amount of education expenses qualifying for a specific tax benefit by part or all of your VA payments. This applies only to the part of your VA payments that is required to be used for education expenses.

You may want to visit the Veterans Administration website at www.va.gov/education for specific information about the various VA benefits for education.

You have returned to college and are receiving two education benefits under the latest GI Bill: (1) a $1,534 monthly basic housing allowance (BHA) that is directly deposited to your checking account, and (2) $3,840 paid directly to your college for tuition. Neither of these benefits is taxable and you don't report them on your tax return. You also want to claim an American opportunity credit on your return. Your total tuition charges are $5,000. To figure the amount of credit, you must first subtract the $3,840 from your qualified education expenses because this payment under the GI Bill was required to be used for education expenses. You don't subtract any amount of the BHA because it was paid to you and its use wasn't restricted.

Qualified Tuition Reduction

If you are allowed to study tuition free or for a reduced rate of tuition, you may not have to pay tax on this benefit. This is called a tuition reduction. You don't have to include a qualified tuition reduction in your income.

A tuition reduction is qualified only if you receive it from, and use it at, an eligible educational institution. You don't have to use the tuition reduction at the eligible educational institution from which you received it. In other words, if you work for an eligible educational institution and the institution arranges for you to take courses at another eligible educational institution without paying any tuition, you may not have to include the value of the free courses in your income.

The rules for determining if a tuition reduction is qualified, and therefore tax free, are different if the education provided is below the graduate level or is graduate education.

You must include in your income any tuition reduction you receive that is payment for your services.

An eligible educational institution is one that maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it regularly carries on its educational activities.

Qualified tuition reductions apply to officers, owners, or highly compensated employees only if benefits are available to employees on a nondiscriminatory basis. This means that the tuition reduction benefits must be available on substantially the same basis to each member of a group of employees. The group must be defined under a reasonable classification set up by the employer. The classification must not discriminate in favor of owners, officers, or highly compensated employees.

Generally, you must include in income the part of any qualified tuition reduction that represents payment for teaching, research, or other services by the student required as a condition of receiving the qualified tuition reduction. This applies even if all candidates for a degree must perform the services to receive the degree. However, see Exceptions next.

You don't have to include in income the part of any scholarship or fellowship grant that represents payment for teaching, research, or other services if you receive the amount under:

Education Below the Graduate Level

If you receive a tuition reduction for education below the graduate level (including primary and secondary school), it is a qualified tuition reduction, and therefore tax free, only if your relationship to the educational institution providing the benefit is described below.

You are an employee of the eligible educational institution.

You were an employee of the eligible educational institution, but you retired or left on disability.

You are the surviving spouse of an individual who died while an employee of the eligible educational institution or who retired or left on disability.

You are the dependent child or spouse of an individual described in (1) through (3) above.

For purposes of the qualified tuition reduction, a child is a dependent child if the child is under age 25 and both parents have died.

For purposes of the qualified tuition reduction, a dependent child of divorced parents is treated as the dependent of both parents.

A tuition reduction you receive for graduate education is qualified, and therefore tax free, if both of the following requirements are met.

It is provided by an eligible educational institution.

You are a graduate student who performs teaching or research activities for the educational institution.

Any tuition reduction that is taxable should be included as wages in box 1 of your Form W-2. Report the amount from box 1 of Form W-2 on Form 1040 or 1040-SR, line 1a.

2. American Opportunity Credit

Educational institution's EIN required. To claim the American opportunity credit, you must provide the educational institution's employer identification number (EIN) on your Form 8863. You should be able to obtain this information from Form 1098-T or the educational institution.

Form 8862 may be required. If your American opportunity credit was denied or reduced for any reason other than a math or clerical error for any tax year beginning after 2015, you must attach a completed Form 8862, Information To Claim Certain Credits After Disallowance, to your tax return for the next year for which you claim the credit. See Form 8862 and its instructions for details.

Form 1098-T requirement. To be eligible to claim the American opportunity credit, the law requires a taxpayer (or a dependent) to have received Form 1098-T, Tuition Statement, from an eligible educational institution, whether domestic or foreign. However, you may claim the credit if the student doesn't receive a Form 1098-T because the student's educational institution isn't required to furnish a Form 1098-T to the student under existing rules (for example, if the student is a qualified nonresident alien, has qualified education expenses paid entirely with scholarships, has qualified education expenses paid under a formal billing arrangement, or is enrolled in courses for which no academic credit is awarded). If a student's educational institution isn't required to provide a Form 1098-T to the student, you may claim the credit without a Form 1098-T if you otherwise qualify, can demonstrate that you (or a dependent) were enrolled at an eligible educational institution, and can substantiate the payment of qualified tuition and related expenses.You may also claim a credit if the student attended an eligible educational institution required to furnish Form 1098-T but the student doesn't receive Form 1098-T before you file your tax return (for example, if the institution is otherwise required to furnish the Form 1098-T and doesn't furnish it or refuses to do so) and you take the following required steps: After January 31, 2024, but before you file your 2023 tax return, you or the student must request that the educational institution furnish a Form 1098-T. You must fully cooperate with the educational institution's efforts to gather the information needed to furnish the Form 1098-T. You must also otherwise qualify for the benefit, be able to demonstrate that you (or a dependent) were enrolled at an eligible educational institution, and substantiate the payment of qualified tuition and related expenses.

Ban on claiming the American opportunity credit. If you claim the American opportunity credit even though you're not eligible, you may be banned from claiming the credit for 2 or 10 years depending on your conduct. See Caution under Introduction below.

Taxpayer identification number (TIN) needed by due date of return. If you haven't been issued a TIN by the due date of your 2023 return (including extensions), you can't claim the American opportunity credit on either your original or an amended 2023 return. Also, the American opportunity credit isn't allowed on either your original or an amended 2023 return for a student who hasn't been issued a TIN by the due date of your return (including extensions).

For 2023, there are two tax credits available to help you offset the costs of higher education by reducing the amount of your income tax. They are the American opportunity credit (this chapter) and the lifetime learning credit ( chapter 3 ).

This chapter explains:

Who can claim the American opportunity credit,

What expenses qualify for the credit,

Who is an eligible student,

Who can claim a dependent's expenses,

How to figure the credit,

How to claim the credit, and

When the credit must be repaid.

For 2023, you may be able to claim a credit of up to $2,500 for adjusted qualified education expenses paid for each student who qualifies for the American opportunity credit.

A tax credit reduces the amount of income tax you may have to pay. Unlike a deduction, which reduces the amount of income subject to tax, a credit directly reduces the tax itself. Forty percent of the American opportunity credit may be refundable. This means that if the refundable portion of your credit is more than your tax, the excess will be refunded to you.

Your allowable American opportunity credit may be limited by the amount of your income. Also, the nonrefundable part of the credit may be limited by the amount of your tax.

See Table 2-1 for the basics of this credit. The details are discussed in this chapter.

For each student, you can elect for any year only one of the credits. For example, if you elect to claim the American opportunity credit for a dependent on your 2023 tax return, you can't use that same dependent's qualified education expenses to figure the lifetime learning credit for 2023.

If you pay qualified education expenses for more than one student in the same year, you can choose to claim the American opportunity credit on a per-student, per-year basis. If you pay qualified education expenses for a student (or students) for whom you don't claim the American opportunity credit, you can use the adjusted qualified education expenses of that student (or those students) in figuring your lifetime learning credit. This means that, for example, you can claim the American opportunity credit for one student and the lifetime learning credit for another student in the same year.

There are several differences between these two credits. For example, you can claim the American opportunity credit based on the same student's expenses for no more than 4 tax years. However, there is no limit on the number of years for which you can claim a lifetime learning credit based on the same student's expenses. The differences between these credits are shown in the Appendix near the end of this publication.

If your American opportunity credit was denied or reduced for any reason other than a math or clerical error for any tax year beginning after 2015, you must attach a completed Form 8862 to your tax return for the next tax year for which you claim the credit. See Form 8862 and its instructions for details.

Table 2-1. Overview of the American Opportunity Credit for 2023

Can You Claim the Credit?

The following rules will help you determine if you are eligible to claim the American opportunity credit on your tax return.

Generally, you can claim the American opportunity credit if all three of the following requirements are met.

You pay qualified education expenses of higher education.

You pay the education expenses for an eligible student.

The eligible student is either yourself, your spouse, or a dependent you claim on your tax return.

Qualified education expenses paid by a dependent you claim on your tax return, or by a third party for that dependent, are considered paid by you.

Generally, you can claim the American opportunity credit for a student only if all of the following four requirements are met.

As of the beginning of 2023, the student had not completed the first 4 years of postsecondary education (generally, the freshman through senior years of college), as determined by the eligible educational institution. For this purpose, don't include academic credit awarded solely because of the student's performance on proficiency examinations.

The American opportunity credit has not been claimed by you or anyone else (see below) for this student for any 4 tax years before 2023. If the American opportunity credit has been claimed for this student for any 3 or fewer tax years before 2023, this requirement is met.

For at least one academic period beginning (or treated as beginning) in 2023, the student both:

Was enrolled in a program that leads to a degree, certificate, or other recognized educational credential; and

Carried at least one-half the normal full-time workload for their course of study.

The standard for what is half of the normal full-time workload is determined by each eligible educational institution. However, the standard may not be lower than any of those established by the U.S. Department of Education under the Higher Education Act of 1965.

For 2023, treat an academic period beginning in the first 3 months of 2024 as if it began in 2023 if qualified education expenses for the student were paid in 2023 for that academic period. See Prepaid expenses , later.

As of the end of 2023, the student had not been convicted of a federal or state felony for possessing or distributing a controlled substance.

Sharon was eligible for the American opportunity credit for 2017, 2018, 2020, and 2022. Sharon’s parents claimed the American opportunity credit for Sharon on their 2017, 2018, and 2020 tax returns. Sharon claimed the American opportunity credit on her 2022 tax return. The American opportunity credit has been claimed for Sharon for 4 tax years before 2023. Therefore, the American opportunity credit can't be claimed for Sharon for 2023. If Sharon were to file Form 8863 for 2023, the box on Part III, line 23, should be checked “Yes” and only the lifetime learning credit would be able to be claimed.

Wilbert was eligible for the American opportunity credit for 2019, 2020, 2021, and 2023. Wilbert’s parents claimed the American opportunity credit for Wilbert on their tax returns for 2019, 2020, and 2021. No one claimed an American opportunity credit for Wilbert for any other tax year. The American opportunity credit has been claimed for Wilbert for only 3 tax years before 2023. Therefore, Wilbert meets the second requirement to be eligible for the American opportunity credit. If Wilbert were to file Form 8863 for 2023, the box on Part III, line 23, should be checked “No.” If Wilbert meets all of the other requirements, he is eligible for the American opportunity credit.

Glenda enrolls on a full-time basis in a degree program for the 2024 spring semester, which begins in January 2024. Glenda pays the tuition for the 2024 spring semester in December 2023. Because the tuition Glenda paid in 2023 relates to an academic period that begins in the first 3 months of 2024, the eligibility to claim an American opportunity credit in 2023 is determined as if the 2024 spring semester began in 2023. Therefore, Glenda satisfies this third requirement.

“Qualified education expenses” are defined later under Qualified Education Expenses . “Eligible students” are defined later under Who Is an Eligible Student . A dependent you claim on your tax return is defined later under Who Can Claim a Dependent's Expenses .

You may find Figure 2-1 helpful in determining if you can claim an American opportunity credit on your tax return.

Figure 2-1. Can You Claim the American Opportunity Credit for 2023?

Figure 2-1 Can you claim the American opportunity credit for 2023?

Summary: This flowchart is used to determine if you qualify to claim the American opportunity Credit for 2023.

This is the start of the flowchart.

Decision (1)

Did you pay qualified education expenses in 2023 for an eligible student?*

Decision (2)

Did the academic period for which you paid qualified education expenses begin in 2023 or the first 3 months of 2024?

Decision (3)

Is the eligible student you, your spouse (if married filing jointly), or your dependent you claim on your tax return?

Decision (4)

Are you listed as a dependent on another person's tax return?

Decision (5)

Is your filing status married filing separately?

Decision (6)

For any part of 2023, were you (or your spouse) a nonresident alien who didn’t elect to be treated as a resident alien for tax purposes?

Decision (7)

Is your modified adjusted gross income (MAGI) less than $90,000 ($180,000 if married filing jointly)?

Decision (8)

Did you use the same expenses to claim a deduction or credit?

Decision (9)

Were the same expenses paid entirely with a tax-free scholarship, grant, or employer-provided educational assistance?

Decision (10)

Did you or someone else receive a refund of all the expenses?

Process (a)

You can't claim the American opportunity credit for 2023

Process (b)

You can claim the American opportunity credit for 2023.**

This is the end of the flowchart.

Please click here for the text description of the image.

You can't claim the American opportunity credit for 2023 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 .

You (or your spouse) were a nonresident alien for any part of 2023 and the nonresident alien didn't elect to be treated as a resident alien for tax purposes. More information on nonresident aliens can be found in Pub. 519, U.S. Tax Guide for Aliens.

You weren’t issued an SSN (or ITIN) by the due date of your 2023 return (including extensions). You can't claim the American opportunity credit on either your original or an amended 2023 return. Also, you can't claim this credit on your original or an amended 2023 return for a student who wasn’t issued an SSN, ATIN, or ITIN by the due date of your return (including extensions). If an ATIN or ITIN is applied for on or before the due date of a 2023 return (including extensions) and the IRS issues an ATIN or ITIN as a result of the application, the IRS will consider the ATIN or ITIN as issued on or before the due date of the return.

What Expenses Qualify?

The American opportunity credit is based on adjusted qualified education expenses you pay for yourself, your spouse, or a dependent you claim on your tax return. Generally, the credit is allowed for adjusted qualified education expenses paid in 2023 for an academic period beginning in 2023 or beginning in the first 3 months of 2024.

For example, if you paid $1,500 in December 2023 for qualified tuition for the spring 2024 semester beginning January 2024, you can use that $1,500 in figuring your 2023 credit.

An academic period includes a semester, trimester, quarter, or other period of study (such as a summer school session) as reasonably determined by an educational institution. If an educational institution uses credit hours or clock hours and doesn't have academic terms, each payment period can be treated as an academic period.

You can claim an American opportunity credit for qualified education expenses paid with the proceeds of a loan. Use the expenses to figure the American opportunity credit for the year in which the expenses are paid, not the year in which the loan is repaid. Treat loan payments sent directly to the educational institution as paid on the date the institution credits the student's account.

You can claim an American opportunity credit for qualified education expenses not refunded when a student withdraws.

Qualified Education Expenses

For purposes of the American opportunity credit, qualified education expenses are tuition and certain related expenses required for enrollment or attendance at an eligible educational institution.

An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education. Virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions meet this definition.

An eligible educational institution also includes certain educational institutions located outside the United States that are eligible to participate in a student aid program administered by the U.S. Department of Education.

Student activity fees are included in qualified education expenses only if the fees must be paid to the institution as a condition of enrollment or attendance.

However, expenses for books, supplies, and equipment needed for a course of study are included in qualified education expenses whether or not the materials are purchased from the educational institution.

Qualified education expenses paid in 2023 for an academic period that begins in the first 3 months of 2024 can be used in figuring an education credit for 2023 only. See Academic period , earlier. For example, if you pay $2,000 in December 2023 for qualified tuition for the 2024 winter quarter that begins in January 2024, you can use that $2,000 in figuring an education credit for 2023 only (if you meet all the other requirements).

In the following examples, assume that each student is an eligible student at an eligible educational institution.

Jefferson is a sophomore in University V's degree program in dentistry. This year, in addition to tuition, there is a requirement to pay a fee to the university for the rental of the dental equipment used in this program. Because the equipment rental is needed for this course of study, Jefferson's equipment rental fee is a qualified expense.

Grace and William, both first-year students at College W, are required to have certain books and other reading materials to use in their mandatory first-year classes. The college has no policy about how students should obtain these materials, but any student who purchases them from College W's bookstore will receive a bill directly from the college. William bought the books from a friend; Grace bought the books at College W's bookstore. Both are qualified education expenses for the American opportunity credit.

When Kelly enrolled at College X for the freshman year, the school required payment of a separate student activity fee in addition to the tuition. This activity fee is required of all students, and is used solely to fund on-campus organizations and activities run by students, such as the student newspaper and the student government. No portion of the fee covers personal expenses. Although labeled as a student activity fee, the fee is required for Kelly's enrollment and attendance at College X and is a qualified expense.

You can't do any of the following.

Deduct higher education expenses on your income tax return (as, for example, a business expense) and also claim an American opportunity credit based on those same expenses.

Claim an American opportunity credit for any student and use any of that student's expenses in figuring your lifetime learning credit.

Figure the tax-free portion of a distribution from a Coverdell education savings account (ESA) or qualified tuition program (QTP) using the same expenses you used to figure the American opportunity credit. See Coordination With American Opportunity and Lifetime Learning Credits in chapter 6 and Coordination With American Opportunity and Lifetime Learning Credits in chapter 7 .

Claim a credit based on qualified education expenses paid with tax-free educational assistance, such as a scholarship, grant, or assistance provided by an employer. See Adjustments to Qualified Education Expenses next.

For each student, reduce the qualified education expenses paid by or on behalf of that student under the following rules. The result is the amount of adjusted qualified education expenses for each student.

For tax-free educational assistance received in 2023, reduce the qualified educational expenses for each academic period by the amount of tax-free educational assistance allocable to that academic period. See Academic period , earlier.

Some tax-free educational assistance received after 2023 may be treated as a refund of qualified education expenses paid in 2023. This tax-free educational assistance is any tax-free educational assistance received by you or anyone else after 2023 for qualified education expenses paid on behalf of a student in 2023 (or attributable to enrollment at an eligible educational institution during 2023).

If this tax-free educational assistance is received after 2023 but before you file your 2023 income tax return, see Refunds received after 2023 but before your income tax return is filed , later. If this tax-free educational assistance is received after 2023 and after you file your 2023 income tax return, see Refunds received after 2023 and after your income tax return is filed , later.

Tax-free educational assistance includes:

The tax-free parts of scholarships and fellowship grants (see Tax-Free Scholarships and Fellowship Grants in chapter 1 );

The tax-free part of Pell grants (see Pell Grants and Other Title IV Need-Based Education Grants in chapter 1 );

Employer-provided educational assistance (see chapter 10 );

Veterans' educational assistance (see Veterans' Benefits in chapter 1 ); and

Any other nontaxable (tax-free) payments (other than gifts or inheritances) received as educational assistance.

Generally, any scholarship or fellowship grant is treated as tax free. However, a scholarship or fellowship grant isn't treated as tax free to the extent the student includes it in gross income (the student may or may not be required to file a tax return for the year the scholarship or fellowship grant is received) and either of the following is true.

The scholarship or fellowship grant (or any part of it) must be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1.

The scholarship or fellowship grant (or any part of it) may be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1.

A refund of qualified education expenses may reduce adjusted qualified education expenses for the tax year or require repayment (recapture) of a credit claimed in an earlier year. Some tax-free educational assistance received after 2023 may be treated as a refund. See Tax-free educational assistance , earlier.

For each student, figure the adjusted qualified education expenses for 2023 by adding all the qualified education expenses for 2023 and subtracting any refunds of those expenses received from the eligible educational institution during 2023.

If anyone receives a refund after 2023 of qualified education expenses paid on behalf of a student in 2023 and the refund is paid before you file an income tax return for 2023, the amount of qualified education expenses for 2023 is reduced by the amount of the refund.

If anyone receives a refund after 2023 of qualified education expenses paid on behalf of a student in 2023 and the refund is paid after you file an income tax return for 2023, you may need to repay some or all of the credit. See Credit recapture next.

If any tax-free educational assistance for the qualified education expenses paid in 2023, or any refund of your qualified education expenses paid in 2023, is received after you file your 2023 income tax return, you must recapture (repay) any excess credit. You do this by refiguring the amount of your adjusted qualified education expenses for 2023 by reducing the expenses by the amount of the refund or tax-free educational assistance. You then refigure your education credit(s) for 2023 and figure the amount by which your 2023 tax liability would have increased if you claimed the refigured credit(s). Include that amount as an additional tax for the year the refund or tax-free assistance was received.

You paid $7,000 tuition and fees in August 2023, and your child began college in September 2023. You filed your 2023 tax return on February 17, 2024, and claimed an American opportunity credit of $2,500. After you filed your return, you received a refund of $4,000. You must refigure your 2023 American opportunity credit using $3,000 of qualified education expenses instead of $7,000. The refigured credit is $2,250. The increase to your tax liability is $250. Include the difference of $250 as additional tax on your 2024 tax return. See the instructions for your 2024 income tax return to determine where to include this tax.

Don't reduce qualified education expenses by amounts paid with funds the student receives as:

Payment for services, such as wages;

An inheritance; or

A withdrawal from the student's personal savings.

Don't reduce the qualified education expenses by any scholarship or fellowship grant reported as income on the student's tax return in the following situations.

The use of the money is restricted, by the terms of the scholarship or fellowship grant, to costs of attendance (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1.

The use of the money isn't restricted.

Joan paid $3,000 for tuition and $5,000 for room and board at University X. The university did not require payment of any fees in addition to the tuition in order to enroll in or attend classes. To help pay these costs, Joan was awarded a $2,000 scholarship and a $4,000 student loan. The terms of the scholarship state that it can be used to pay any of Joan's college expenses.

University X applies the $2,000 scholarship against Joan's $8,000 total bill, and Joan pays the $6,000 balance of the bill from University X with a combination of the student loan and personal savings. Joan doesn't report any portion of the scholarship as income on the tax return.

In figuring the amount of either education credit (American opportunity or lifetime learning), Joan must reduce the qualified education expenses by the amount of the scholarship ($2,000) because the entire scholarship was excluded from the reported income on Joan’s tax return. The student loan isn't tax-free educational assistance, so the qualified expenses don't need to be reduced by any part of the loan proceeds. Joan is treated as having paid $1,000 in qualified education expenses ($3,000 tuition − $2,000 scholarship).

The facts are the same as in Example 1 , except that Joan reports the entire scholarship as income on the tax return. Because Joan reported the entire $2,000 scholarship as income, the qualified education expenses don't need to be reduced. Joan is treated as having paid $3,000 in qualified education expenses.

You may be able to increase your American opportunity credit when the student (you, your spouse, or your dependent) includes certain scholarships or fellowship grants in the student's gross income. Your credit may increase only if the amount of the student's qualified education expenses minus the total amount of scholarships and fellowship grants is less than $4,000. If this situation applies, consider including some or all of the scholarship or fellowship grant in the student's income in order to treat the included amount as paying nonqualified expenses instead of qualified education expenses. Nonqualified expenses are expenses such as room and board that aren't qualified education expenses such as tuition and related fees.

Scholarships and fellowship grants that the student includes in income don't reduce the student's qualified education expenses available to figure your American opportunity credit. Thus, including enough scholarship or fellowship grant in the student's income to report up to $4,000 in qualified education expenses for your American opportunity credit may increase the credit by enough to increase your tax refund or reduce the amount of tax you owe even considering any increased tax liability from the additional income. However, the increase in tax liability as well as the loss of other tax credits may be greater than the additional American opportunity credit and may cause your tax refund to decrease or the amount of tax you owe to increase. Your specific circumstances will determine what amount, if any, of scholarship or fellowship grant to include in income to maximize your tax refund or minimize the amount of tax you owe.

The scholarship or fellowship grant must be one that may qualify as a tax-free scholarship under the rules discussed in chapter 1 . Also, the scholarship or fellowship grant must be one that may (by its terms) be used for nonqualified expenses. Finally, the amount of the scholarship or fellowship grant that is applied to nonqualified expenses can't exceed the amount of the student's actual nonqualified expenses that are paid in the tax year. This amount may differ from the student's living expenses estimated by the student's school in figuring the official cost of attendance under student aid rules.

The fact that the educational institution applies the scholarship or fellowship grant to qualified education expenses, such as tuition and related fees, doesn't prevent the student from choosing to apply certain scholarships or fellowship grants to the student’s actual nonqualified expenses. By making this choice (that is, by including the part of the scholarship or fellowship grant applied to the student’s nonqualified expenses in income), the student may increase taxable income and may be required to file a tax return. But this allows payments made in cash, by check, by credit or debit card, or with borrowed funds such as a student loan to be applied to qualified education expenses.

Example 1—No scholarship.

Bill, age 28 and unmarried, enrolled full-time in 2023 as a first-year student at a local college to earn a degree in law enforcement. This was Bill’s first year of postsecondary education. During 2023, Bill paid $5,600 for qualified education expenses and $4,400 for room and board for the fall 2023 semester. Bill and the college meet all the requirements for the American opportunity credit. Bill's adjusted gross income (AGI) and MAGI, for purposes of figuring the credit, are $37,350. Bill claims the standard deduction of $13,850, resulting in taxable income of $23,500 and an income tax liability before credits of $2,603. Bill claims no credits other than the American opportunity credit. Bill figures the American opportunity credit based on qualified education expenses of $4,000, which results in a credit of $2,500 and a tax liability after credits of $103 ($2,603 − $2,500).

Example 2—Scholarship excluded from income.

The facts are the same as in Example 1—No scholarship , except that Bill was awarded a $5,600 scholarship. Under the terms of the scholarship, it may be used to pay any educational expenses, including room and board. If Bill excludes the scholarship from income, it will be deemed (for purposes of figuring the education credit) to have been applied to pay tuition, required fees, and course materials. Bill’s adjusted qualified education expenses would be zero and there would be no education credit. Therefore, Bill's tax liability after credits would be $2,603.

Example 3—Scholarship partially included in income.

The facts are the same as in Example 2—Scholarship excluded from income . If, unlike Example 2 , Bill includes $4,000 of the scholarship in income, the $4,000 will be deemed to have been applied to pay for room and board. The remaining $1,600 of the $5,600 scholarship would reduce the qualified education expenses, and the adjusted qualified education expenses would be $4,000. Bill's AGI and MAGI would increase to $41,350, the taxable income would increase to $27,500, and the tax liability before credits would increase to $3,083. Based on the adjusted qualified education expenses of $4,000, Bill would be able to claim an American opportunity credit of $2,500 and the tax liability after credits would be $583 ($3,083 − $2,500).

Example 4—Scholarship applied by the postsecondary school to tuition.

The facts are the same as in Example 3—Scholarship partially included in income , except the $5,600 scholarship is paid directly to the local college. The fact that the local college applies the scholarship to Bill's tuition and related fees doesn't prevent Bill from including $4,000 of the scholarship in income. As in Example 3 , by doing so, Bill will be deemed to have applied $4,000 to pay for room and board. Bill would be able to claim the American opportunity credit of $2,500 and the tax liability after credits would be $583.

Example 5—Student with a dependent child.

Jane, age 28 and unmarried, enrolled full-time as a first-year student at a local technical college to get a certificate as a computer technician. This was Jane’s first year of postsecondary education. During 2023, Jane paid $6,000 for qualified education expenses. Jane and the college meet all the requirements for the American opportunity credit. Jane has a dependent child, age 10, who is a qualifying child for purposes of receiving the earned income credit (EIC) and the child tax credit. Jane's wages are $21,400. Jane withheld no income taxes on these wages and has no other income or adjustments. Jane was awarded a $5,500 scholarship. Under the terms of the scholarship, it may be used to pay tuition and any living expense, including rent. Jane paid $10,000 in living expenses in 2023.

If Jane excludes the entire scholarship from income , Jane will be deemed to have applied the entire scholarship to pay qualified education expenses. The AGI and MAGI would be $21,400. The tax liability before any credits would be $61. The qualified education expenses would be reduced to $500. Jane would be able to receive a $261 American opportunity credit ($200 refundable and $61 nonrefundable), a $1,600 additional child tax credit, and a $3,995 EIC. In total, Jane would be able to receive a tax refund of $5,795.

If Jane includes the entire scholarship in income , Jane will be deemed to have applied the entire scholarship to pay living expenses. The qualified education expenses would be $6,000, and the AGI and MAGI would be $26,900. The tax liability before any credits would be $613. Jane would be able to receive a $1,613 American opportunity credit ($1,000 refundable and $613 nonrefundable), a $1,600 additional child tax credit, and a $3,138 EIC. In total, Jane would be able to receive a tax refund of $5,738.

If Jane includes $3,500 of the scholarship in income , Jane will be deemed to have applied $3,500 of the scholarship to pay living expenses, and $2,000 to pay qualified education expenses. The qualified education expenses would be $4,000, and the AGI and MAGI would be $24,900. The tax liability before any credits would be $413. Jane would be able to receive a $1,413 American opportunity credit ($1,000 refundable and $413 nonrefundable), a $1,600 additional child tax credit, and a $3,457 EIC. In total, Jane would be able to receive a tax refund of $6,057.

If Jane includes $1,500 of the scholarship in income , Jane will be deemed to have applied $1,500 of the scholarship to pay living expenses, and $4,000 to pay qualified education expenses. The qualified education expenses would be $2,000, and the AGI and MAGI would be $22,900. The tax liability before any credits would be $211. Jane would be able to receive a $1,011 American opportunity credit ($800 refundable and $211 nonrefundable), a $1,600 additional child tax credit, and a $3,777 EIC. In total, Jane would be able to receive a tax refund of $6,177. This is the highest tax refund among these scenarios.

Whether you will benefit from applying a scholarship or fellowship grant to nonqualified expenses will depend on the amount of the student's qualified education expenses, the amount of the scholarship or fellowship grant, and whether the scholarship or fellowship grant may (by its terms) be used for nonqualified expenses. Any benefit will also depend on the student’s federal and state marginal tax rates as well as any federal and state tax credits the student claims. Before deciding, look at the total amount of your federal and state tax refunds or taxes owed and, if the student is your dependent, the student’s tax refunds or taxes owed. For example, if you are the student and you also claim the EIC, choosing to apply a scholarship or fellowship grant to nonqualified expenses by including the amount in your income may benefit you if the increase to your American opportunity credit is more than the decrease to your EIC.

Expenses That Don't Qualify

Qualified education expenses don't include amounts paid for:

Medical expenses (including student health fees);

Room and board;

Transportation; or

Similar personal, living, or family expenses.

Qualified education expenses generally don't include expenses that relate to any course of instruction or other education that involves sports, games, or hobbies, or any noncredit course. However, if the course of instruction or other education is part of the student's degree program, these expenses can qualify.

Some eligible educational institutions combine all of their fees for an academic period into one amount. If you don't receive or don't have access to an allocation showing how much you paid for qualified education expenses and how much you paid for personal expenses, such as those listed earlier, contact the institution. The institution is generally required to make this allocation and provide you with the amount you paid for qualified education expenses on Form 1098-T. See Figuring the Credit , later, for more information about Form 1098-T.

To claim the American opportunity credit, the student for whom you pay qualified education expenses must be an eligible student. This is a student who meets all of the following requirements.

The student didn't have expenses that were used to figure an American opportunity credit in any 4 earlier tax years.

The student hadn't completed the first 4 years of postsecondary education (generally, the freshman, sophomore, junior, and senior years of college) before 2023.

For at least one academic period beginning in 2023 (or the first 3 months of 2024 if the qualified expenses were paid in 2023), the student was enrolled at least half-time in a program leading to a degree, certificate, or other recognized educational credential.

The student hasn't been convicted of any federal or state felony for possessing or distributing a controlled substance as of the end of 2023.

A student has completed the first 4 years of postsecondary education if the institution at which the student is enrolled awards the student 4 years of academic credit at that institution for coursework completed by the student before 2023. This student generally wouldn't be an eligible student for purposes of the American opportunity credit.

Any academic credit awarded solely on the basis of the student's performance on proficiency examinations is disregarded in determining whether the student has completed 4 years of postsecondary education.

A student was enrolled at least half-time if the student was taking at least half the normal full-time workload for their course of study.

Figure 2-2. Who Is an Eligible Student for the American Opportunity Credit?

Note under title: This chart is provided to help you quickly decide whether a student is eligible for the American opportunity credit. See the text for more details.

Did the student complete the first 4 years of postsecondary education before the beginning of the tax year?

Was the American opportunity credit claimed in at least 4 prior tax years for this student?

Was the student 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 during 2023 (or the first 3 months of 2024 if the qualified expenses were paid in 2023)?

Is the student free of any federal or state felony conviction for possessing or distributing a controlled substance as of the end of the tax year?

The student isn't an eligible student.

The student is an eligible student.

Mack graduated from high school in June 2022. In September, Mack enrolled in an undergraduate degree program at College U, and attended full-time for both the 2022 fall and 2023 spring semesters. For the 2023 fall semester, Mack was enrolled less than half-time. Because Mack was enrolled in an undergraduate degree program on at least a half-time basis for at least one academic period that began in 2022 and at least one academic period that began in 2023, Mack is an eligible student for tax years 2022 and 2023 (including the 2023 fall semester when Mack enrolled at College U on less than a half-time basis).

After taking classes at College V on a part-time basis for a few years, Shelly became a full-time student for the 2023 spring semester. College V classified Shelly as a second-semester senior (fourth year) for the 2023 spring semester and as a first-semester graduate student (fifth year) for the 2023 fall semester. Because College V didn't classify Shelly as having completed the first 4 years of postsecondary education as of the beginning of 2023, Shelly is an eligible student for tax year 2023. Therefore, the qualified education expenses paid for the 2023 spring semester and the 2023 fall semester are taken into account in figuring the American opportunity credit for 2023.

During the 2022 fall semester, Larry was a high school student who took classes on a half-time basis at College X. Larry wasn't enrolled as part of a degree program at College X because College X only admits students to a degree program if they have a high school diploma or equivalent. Because Larry wasn't enrolled in a degree program at College X during 2022, Larry wasn't an eligible student for tax year 2022.

The facts are the same as in Example 3 . During the 2023 spring semester, Larry again attended College X but not as part of a degree program. Larry graduated from high school in June 2023. For the 2023 fall semester, Larry enrolled as a full-time student in College X as part of a degree program, and College X awarded Larry credit for the prior coursework at College X. Because Larry was enrolled in a degree program at College X for the 2023 fall term on at least a half-time basis, Larry is an eligible student for all of tax year 2023. Therefore, the qualified education expenses paid for classes taken at College X during both the 2023 spring semester (during which Larry wasn't enrolled in a degree program) and the 2023 fall semester are taken into account in figuring any American opportunity credit.

Dee graduated from high school in June 2022. In January 2023, Dee enrolled in a 1-year postsecondary certificate program on a full-time basis to obtain a certificate as a travel agent. Dee completed the program in December 2023 and was awarded a certificate. In January 2024, Dee enrolled in a 1-year postsecondary certificate program on a full-time basis to obtain a certificate as a computer programmer. Dee is an eligible student for both tax years 2023 and 2024 because the degree requirement, the workload requirement, and the year of study requirement for those years have been met.

Who Can Claim a Dependent's Expenses?

If there are qualified education expenses for your dependent during a tax year, either you or your dependent, but not both of you, can claim an American opportunity credit for your dependent's expenses for that year.

For you to claim an American opportunity credit for your dependent's expenses, you must also claim your dependent on your tax return. You do this by listing your dependent's name and other required information on Form 1040 or 1040-SR.

If you claim on your tax return an eligible student who is your dependent, treat any expenses paid (or deemed paid) by your dependent as if you had paid them. Include these expenses when figuring the amount of your American opportunity credit.

If you claim a dependent who is an eligible student, only you can include any expenses you paid when figuring the amount of the American opportunity credit. If neither you nor anyone else claims the dependent, only the dependent can include any expenses you paid when figuring the American opportunity credit.

Someone other than you, your spouse, or your dependent (such as a relative or former spouse) may make a payment directly to an eligible educational institution to pay for an eligible student's qualified education expenses. In this case, the student is treated as receiving the payment from the other person and, in turn, paying the institution. If you claim the student as a dependent on your tax return, you are considered to have paid the expenses.

In 2023, Todd’s grandparent makes a payment directly to an eligible educational institution for Todd's qualified education expenses. For purposes of claiming an American opportunity credit, Todd is treated as receiving the money from the grandparent and, in turn, paying the qualified education expenses himself.

Unless Todd is claimed as a dependent on someone else's 2023 tax return, only Todd can use the payment to claim an American opportunity credit.

If anyone, such as Todd's parents, claims Todd on their 2023 tax return, whoever claims Todd may be able to use the expenses to claim an American opportunity credit. If anyone else claims Todd, Todd can't claim an American opportunity credit.

When an eligible educational institution provides a reduction in tuition to an employee of the institution (or spouse or dependent child of an employee), the amount of the reduction may or may not be taxable. If it is taxable, the employee is treated as receiving a payment of that amount and, in turn, paying it to the educational institution on behalf of the student. For more information on tuition reductions, see Qualified Tuition Reduction in chapter 1.

Figuring the Credit

The amount of the American opportunity credit (per eligible student) is the sum of:

100% of the first $2,000 of qualified education expenses you paid for the eligible student, and

25% of the next $2,000 of qualified education expenses you paid for that student.

The maximum amount of American opportunity credit you can claim in 2023 is $2,500 multiplied by the number of eligible students. You can claim the full $2,500 for each eligible student for whom you paid at least $4,000 of adjusted qualified education expenses. However, the credit may be reduced based on your MAGI. See Effect of the Amount of Your Income on the Amount of Your Credit , later.

Jack and Kay are married and file a joint tax return. For 2023, they claim their dependent child on their tax return. Their MAGI is $70,000. Their child is in the junior (third) year of studies at the local university. Jack and Kay paid qualified education expenses of $4,300 in 2023.

Jack and Kay, their child, and the local university meet all of the requirements for the American opportunity credit. Jack and Kay can claim a $2,500 American opportunity credit in 2023. This is 100% of the first $2,000 of qualified education expenses, plus 25% of the next $2,000.

To help you figure your American opportunity credit, the student may receive Form 1098-T. Generally, an eligible educational institution (such as a college or university) must send Form 1098-T (or acceptable substitute) to each enrolled student by January 31, 2024. An institution will report payments received (box 1) for qualified education expenses. However, the amount on Form 1098-T might be different from what you paid. When figuring the credit, use only the amounts you paid or are deemed to have paid in 2023 for qualified education expenses.

In addition, Form 1098-T should give other information for that institution, such as adjustments made for prior years, the amount of scholarships or grants, reimbursements or refunds, and whether the student was enrolled at least half-time or was a graduate student.

The eligible educational institution may ask for a completed Form W-9S, Request for Student's or Borrower's Taxpayer Identification Number and Certification, or similar statement to obtain the student's name, address, and TIN.

Effect of the Amount of Your Income on the Amount of Your Credit

The amount of your American opportunity credit is phased out (gradually reduced) if your MAGI is between $80,000 and $90,000 ($160,000 and $180,000 if you file a joint return). You can't claim an American opportunity credit if your MAGI is $90,000 or more ($180,000 or more if you file a joint return).

For most taxpayers, MAGI is adjusted gross income (AGI) as figured on their federal income tax return.

If you file Form 1040 or 1040-SR, your MAGI is the AGI on line 11 of that form, modified by adding back any:

Foreign earned income exclusion,

Foreign housing exclusion,

Foreign housing deduction,

Exclusion of income by bona fide residents of American Samoa, and

Exclusion of income by bona fide residents of Puerto Rico.

Worksheet 2-1. MAGI for the American Opportunity Credit

If your MAGI is within the range of incomes where the credit must be reduced, you will figure your reduced credit using lines 2–7 of Form 8863, Part I. The same method is shown in the following example.

You are filing a joint return and your MAGI is $165,000. In 2023, you paid $5,000 of qualified education expenses.

You figure a tentative American opportunity credit of $2,500 (100% of the first $2,000 of qualified education expenses, plus 25% of the next $2,000 of qualified education expenses).

Because your MAGI is within the range of incomes where the credit must be reduced, you must multiply your tentative credit ($2,500) by a fraction. The numerator (top part) of the fraction is $180,000 (the upper limit for those filing a joint return) minus your MAGI. The denominator (bottom part) is $20,000, the range of incomes for the phaseout ($160,000 to $180,000). The result is the amount of your phased out (reduced) American opportunity credit ($1,875).

Refundable Part of Credit

Forty percent of the American opportunity credit is refundable for most taxpayers. However, if you were under age 24 at the end of 2023 and the conditions listed below apply to you, you can't claim any part of the American opportunity credit as a refundable credit on your tax return. Instead, your allowed credit (figured on Form 8863, Part II) will be used to reduce your tax as a nonrefundable credit only.

You don't qualify for a refund if items 1 (a, b, or c), 2, and 3 below apply to you.

Under age 18 at the end of 2023, or

Age 18 at the end of 2023 and your earned income (defined below) was less than one-half of your support (defined below), or

Over age 18 and under age 24 at the end of 2023 and a full-time student (defined below) and your earned income (defined below) was less than one-half of your support (defined below).

At least one of your parents was alive at the end of 2023.

You are filing a return as single, head of household, qualifying surviving spouse, or married filing separately for 2023.

Earned income includes wages, salaries, professional fees, and other payments received for personal services actually performed. Earned income includes the part of any scholarship or fellowship grant that represents payment for teaching, research, or other services performed by the student that are required as a condition for receiving the scholarship or fellowship grant. Earned income doesn't include that part of the compensation for personal services rendered to a corporation which represents a distribution of earnings or profits rather than a reasonable allowance as compensation for the personal services actually rendered.

If you are a sole proprietor or a partner in a trade or business in which both personal services and capital are material income-producing factors, earned income also includes a reasonable allowance for compensation for personal services, but not more than 30% of your share of the net profits from that trade or business (after subtracting the deduction for one-half of self-employment tax). However, if capital isn't an income-producing factor and your personal services produced the business income, the 30% limit doesn't apply.

Your support includes food, shelter, clothing, medical and dental care, education, and the like. Generally, the amount of the item of support will be the amount of expenses incurred by the one furnishing such item. If the item of support is in the form of property or lodging, measure the amount of such item of support by its fair market value. However, a scholarship received by you isn't considered support if you are a full-time student. See Pub. 501 for details.

You are a full-time student for 2023 if during any part of any 5 calendar months during the year you were enrolled as a full-time student at an eligible educational institution (defined earlier), or took a full-time, on-farm training course given by such an institution or by a state, county, or local government agency.

You claim the American opportunity credit by completing Form 8863 and submitting it with your Form 1040 or 1040-SR. Enter the nonrefundable part of the credit on Schedule 3 (Form 1040), line 3. Enter the refundable part of the credit on Form 1040 or 1040-SR, line 29.

3. Lifetime Learning Credit

Modified adjusted gross income (MAGI) limits. For 2023, the amount of your lifetime learning credit is gradually reduced (phased out) if your MAGI is between $80,000 and $90,000 ($160,000 and $180,000 if you file a joint return). You can't claim the credit if your MAGI is $90,000 or more ($180,000 or more if you file a joint return). For more information, see Figuring the Credit .

Form 1098-T requirement. To be eligible to claim the lifetime learning credit, the law requires a taxpayer (or a dependent) to have received Form 1098-T, Tuition Statement, from an eligible educational institution, whether domestic or foreign.However, you may claim the credit if the student doesn't receive a Form 1098-T because the student's educational institution isn't required to furnish a Form 1098-T to the student under existing rules (for example, if the student is a qualified nonresident alien, has qualified education expenses paid entirely with scholarships, has qualified education expenses paid under a formal billing arrangement, or is enrolled in courses for which no academic credit is awarded). If a student's educational institution isn't required to provide a Form 1098-T to the student, you may claim the credit without a Form 1098-T if you otherwise qualify, can demonstrate that you (or a dependent) were enrolled at an eligible educational institution, and can substantiate the payment of qualified tuition and related expenses.You may also claim the credit if the student attended an eligible educational institution required to furnish Form 1098-T but the student doesn't receive Form 1098-T before you file your tax return (for example, if the institution is otherwise required to furnish the Form 1098-T and doesn't furnish it or refuses to do so) and you take the following required steps: After January 31, 2024, but before you file your 2023 tax return, you or the student must request that the educational institution furnish a Form 1098-T. You must fully cooperate with the educational institution's efforts to gather the information needed to furnish the Form 1098-T. You must also otherwise qualify for the benefit, be able to demonstrate that you (or a dependent) were enrolled at an eligible educational institution, and substantiate the payment of qualified tuition and related expenses.

For 2023, there are two tax credits available to help you offset the costs of higher education by reducing the amount of your income tax. They are the American opportunity credit and the lifetime learning credit. This chapter discusses the lifetime learning credit. The American opportunity credit is discussed in chapter 2 .

Who can claim the lifetime learning credit,

For the tax year, you may be able to claim a lifetime learning credit of up to $2,000 for qualified education expenses paid for all eligible students. There is no limit on the number of years the lifetime learning credit can be claimed for each student.

A tax credit reduces the amount of income tax you may have to pay. Unlike a deduction, which reduces the amount of income subject to tax, a credit directly reduces the tax itself. The lifetime learning credit is a nonrefundable credit. This means that it can reduce your tax to zero, but if the credit is more than your tax, the excess won't be refunded to you.

Your allowable lifetime learning credit may be limited by the amount of your income and the amount of your tax.

For each student, you can elect for any year only one of the credits. For example, if you elect to claim the lifetime learning credit for a child on your 2023 tax return, you can't, for that same child, also claim the American opportunity credit for 2023.

If you are eligible to claim the lifetime learning credit and you are also eligible to claim the American opportunity credit for the same student in the same year, you can choose to claim either credit, but not both.

If you pay qualified education expenses for more than one student in the same year, you can choose to claim certain credits on a per-student, per-year basis. This means that, for example, you can claim the American opportunity credit for one student and the lifetime learning credit for another student in the same year.

There are several differences between these two credits. For example, you can claim the American opportunity credit for the same student for no more than 4 tax years. However, there is no limit on the number of years for which you can claim a lifetime learning credit based on the same student's expenses. The differences between these credits are shown in the Appendix near the end of this publication.

See Table 3-1 for the basics of the credit. The details are discussed in this chapter.

The following rules will help you determine if you are eligible to claim the lifetime learning credit on your tax return.

Generally, you can claim the lifetime learning credit if all three of the following requirements are met.

Table 3-1. Overview of the Lifetime Learning Credit for 2023

You may find Figure 3-1 helpful in determining if you can claim a lifetime learning credit on your tax return.

You can't claim the lifetime learning credit for 2023 if any of the following apply.

You are listed as a dependent on another person's tax return (such as your parents'). 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 filing married filing jointly). MAGI is explained later under Effect of the Amount of Your Income on the Amount of Your Credit .

You (or your spouse) were a nonresident alien for any part of 2023 and the nonresident alien didn't elect to be treated as a resident alien for tax purposes. More information on nonresident aliens can be found in Pub. 519.

You claim the American opportunity credit (see chapter 2) for the same student in 2023.

The lifetime learning credit is based on qualified education expenses you pay for yourself, your spouse, or a dependent you claim on your tax return. Generally, the credit is allowed for qualified education expenses paid in 2023 for an academic period beginning in 2023 or in the first 3 months of 2024.

For example, if you paid $1,500 in December 2023 for qualified tuition for the spring 2024 semester beginning in January 2024, you may be able to use that $1,500 in figuring your 2023 credit.

You can claim a lifetime learning credit for qualified education expenses paid with the proceeds of a loan. You use the expenses to figure the lifetime learning credit for the year in which the expenses are paid, not the year in which the loan is repaid. Treat loan disbursements sent directly to the educational institution as paid on the date the institution credits the student's account.

You can claim a lifetime learning credit for qualified education expenses not refunded when a student withdraws.

For purposes of the lifetime learning credit, qualified education expenses are tuition and certain related expenses required for enrollment in a course at an eligible educational institution. The course must be either part of a postsecondary degree program or taken by the student to acquire or improve job skills.

Student activity fees and expenses for course-related books, supplies, and equipment are included in qualified education expenses only if the fees and expenses must be paid to the institution for enrollment or attendance.

Jackson is a sophomore in University V's degree program in dentistry. This year, in addition to tuition, Jackson is required to pay a fee to the university for the rental of the dental equipment that will be used in this program. Because the equipment rental fee must be paid to University V for enrollment and attendance, the equipment rental fee is a qualified expense.

Donna and Charles, both first-year students at College W, are required to have certain books and other reading materials to use in their mandatory first-year classes. The college has no policy about how students should obtain these materials, but any student who purchases them from College W's bookstore will receive a bill directly from the college. Charles bought the books from a friend, so what was paid for them isn't a qualified education expense. Donna bought the books at College W's bookstore. Although Donna paid College W directly for the first-year books and materials, the payment isn't a qualified expense because the books and materials aren't required to be purchased from College W for enrollment or attendance at the institution.

When Marci enrolled at College X for freshman year, a separate student activity fee in addition to tuition had to be paid. This activity fee is required of all students, and is used solely to fund on-campus organizations and activities run by students, such as the student newspaper and student government. No portion of the fee covers personal expenses. Although labeled as a student activity fee, the fee is required for Marci's enrollment and attendance at College X. Therefore, it is a qualified expense.

Deduct higher education expenses on your income tax return (as, for example, a business expense) and also claim a lifetime learning credit based on those same expenses.

Claim a lifetime learning credit for any student and use any of that student's expenses in figuring your American opportunity credit.

Claim a lifetime learning credit based on the same expenses used to figure the tax-free portion of a distribution from a Coverdell education savings account (ESA) or qualified tuition program (QTP). See Coordination With American Opportunity and Lifetime Learning Credits in chapter 6 and Coordination With American Opportunity and Lifetime Learning Credits in chapter 7.

Figure 3-1. Can You Claim the Lifetime Learning Credit for 2023?

Summary: This flowchart is used to determine if you qualify to claim the lifetime learning credit for 2023.

For additional note, continue to Footnote 1.

For any part of 2023, were you (or your spouse) a nonresident alien who didn't elect to be treated as a resident alien for tax purposes?

Do you have a tax liability (Form 1040 or 1040-SR, line 18, minus Schedule 3 (Form 1040), lines 1, 2, 6d, and 6l)?

Are you claiming an American opportunity credit for the same student?

Decision (11)

Were the same expenses paid with a tax-free scholarship, grant, or employer-provided assistance?

Decision (12)

Did you, or someone else, receive a refund of all the expenses?

You can't claim the lifetime learning credit for 2023.

You can claim the lifetime learning credit for 2023. For additional note, continue to Footnote 2.

Footnote 1: Qualified education expenses paid by a dependent you claim on your tax return or by a third party for that dependent, are considered paid by you.

Footnote 2: Your education credits may be limited to your tax liability minus certain credits. See Form 8863 for more details.

The tax-free part of scholarships and fellowship grants (see Tax-Free Scholarships and Fellowship Grants in chapter 1 );

The scholarship or fellowship grant (or any part of it) must be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1 .

The scholarship or fellowship grant (or any part of it) may be applied (by its terms) to expenses (such as room and board) other than qualified education expenses as defined in Qualified education expenses in chapter 1 .

If any tax-free educational assistance for the qualified education expenses paid in 2023 or any refund of your qualified education expenses paid in 2023 is received after you file your 2023 income tax return, you must recapture (repay) any excess credit. You do this by refiguring the amount of your adjusted qualified education expenses for 2023 by reducing the expenses by the amount of the refund or tax-free educational assistance. You then refigure your education credit(s) for 2023 and figure the amount by which your 2023 tax liability would have increased if you had claimed the refigured credit(s). Include that amount as an additional tax for the year the refund or tax-free assistance was received.

You pay $9,300 in tuition and fees in December 2023, and your child began college in January 2024. You filed your 2023 tax return on February 14, 2024, and claimed a lifetime learning credit of $1,860. You claimed no other tax credits. After you filed your return, your child withdrew from two courses and you received a refund of $2,900. You must refigure your 2023 lifetime learning credit using $6,400 of qualified education expenses instead of $9,300. The refigured credit is $1,280 and your tax liability increased by $580. See the instructions for your 2024 income tax return to determine where to include this tax.

The use of the money is restricted, by the terms of the scholarship or fellowship grant, to costs of attendance (such as room and board) other than qualified education expenses, as defined in Qualified education expenses in chapter 1 .

You may be able to increase your lifetime learning credit when the student (you, your spouse, or your dependent) includes certain scholarships or fellowship grants in the student’s gross income. Your credit may increase only if the amount of the student's qualified education expenses minus the total amount of scholarships and fellowship grants is less than $10,000. If this situation applies, consider including some or all of the scholarship or fellowship grant in the student's income in order to treat the included amount as paying nonqualified expenses instead of qualified education expenses. Nonqualified expenses are expenses such as room and board that aren't qualified education expenses such as tuition and related fees.

Scholarships and fellowship grants that the student includes in income don't reduce the student's qualified education expenses available to figure your lifetime learning credit. Thus, including enough of the scholarship or fellowship grant in the student's income to report up to $10,000 in qualified education expenses for your lifetime learning credit may increase the credit by enough to increase your tax refund or reduce the amount of tax you owe even considering any increased tax liability from the additional income. However, the increase in tax liability as well as the loss of other tax credits may be greater than the additional lifetime learning credit and may cause your tax refund to decrease or the amount of tax you owe to increase. Your specific circumstances will determine what amount, if any, of the scholarship or fellowship grant to include in income to maximize your tax refund or minimize the amount of tax you owe.

The fact that the educational institution applies the scholarship or fellowship grant to qualified education expenses, such as tuition and related fees, doesn't prevent the student from choosing to apply certain scholarships or fellowship grants to the student's actual nonqualified expenses. By making this choice (that is, by including the part of the scholarship or fellowship grant applied to the student's nonqualified expenses in income), the student may increase taxable income and may be required to file a tax return. But this allows payments made in cash, by check, by credit or debit card, or with borrowed funds such as a student loan to be applied to qualified education expenses.

Judy, who is unmarried, is taking courses at a public community college to be recertified to teach in public schools. The adjusted gross income (AGI) and the MAGI, for purposes of the credit, are $28,700. Judy claims the standard deduction of $13,850, resulting in taxable income of $14,850 and a tax liability before credits of $1,565. Judy claims no credits other than the lifetime learning credit. In July 2023, Judy paid $700 for the summer 2023 semester; in August 2023, Judy paid $1,900 for the fall 2023 semester; and in December 2023, Judy paid another $1,900 for the spring semester beginning in January 2024. Judy and the college meet all requirements for the lifetime learning credit. All of the $4,500 tuition paid in 2023 can be used when figuring the 2023 lifetime learning credit. Judy claims a $900 lifetime learning credit and the tax liability after credits is $665.

The facts are the same as in Example 1—No scholarship , except that Judy was awarded a $1,500 scholarship. Under the terms of the scholarship, it may be used to pay any educational expenses, including room and board. If the scholarship is excluded from income, Judy will be deemed (for purposes of figuring the education credit) to have applied the scholarship to pay for tuition, required fees, and course materials. Only $3,000 of the $4,500 tuition paid in 2023 could be used when figuring the 2023 lifetime learning credit. The lifetime learning credit would be reduced to $600 and the tax liability after credits would be $965.

Example 3—Scholarship included in income.

The facts are the same as in Example 2—Scholarship excluded from income . If, unlike Example 2 , Judy includes the $1,500 scholarship in income, Judy will be deemed to have applied the entire scholarship to pay for room and board. Judy's AGI and MAGI would increase to $30,200, the taxable income would be $16,350, and the tax liability before credits would be $1,745. Judy would be able to use the $4,500 of adjusted qualified education expenses to figure the credit. Judy could claim a $900 lifetime learning credit and the tax liability after credits would be $845.

The facts are the same as in Example 3—Scholarship included in income , except the $1,500 scholarship is paid directly to the public community college. The fact that the public community college applies the scholarship to Judy's tuition and related fees doesn't prevent Judy from including the $1,500 scholarship in income. As in Example 3 , by doing so, Judy will be deemed to have applied the entire scholarship to pay for room and board. Judy could claim the $900 lifetime learning credit and the tax liability after credits would be $845.

Whether you will benefit from applying a scholarship or fellowship grant to nonqualified expenses will depend on the amount of the student's qualified education expenses, the amount of the scholarship or fellowship grant, and whether the scholarship or fellowship grant may (by its terms) be used for nonqualified expenses. Any benefit will also depend on the student's federal and state marginal tax rates as well as any federal and state tax credits the student claims. Before deciding, look at the total amount of your federal and state tax refunds or taxes owed and, if the student is your dependent, the student's tax refunds or taxes owed. For example, if you are the student and you also claim the earned income credit, choosing to apply a scholarship or fellowship grant to nonqualified expenses by including the amount in your income may not benefit you if the decrease to your earned income credit as a result of including the scholarship or fellowship grant in income is more than the increase to your lifetime learning credit as a result of including this amount in income.

Qualified education expenses generally don't include expenses that relate to any course of instruction or other education that involves sports, games, or hobbies, or any noncredit course. However, if the course of instruction or other education is part of the student's degree program or is taken by the student to acquire or improve job skills, these expenses can qualify.

Some eligible educational institutions combine all of their fees for an academic period into one amount. If you don't receive or don't have access to an allocation showing how much you paid for qualified education expenses and how much you paid for personal expenses, such as those listed above, contact the institution. The institution is generally required to make this allocation and provide you with the amount you paid for qualified education expenses on Form 1098-T. See Figuring the Credit , later, for more information about Form 1098-T.

For purposes of the lifetime learning credit, an eligible student is a student who is enrolled in one or more courses at an eligible educational institution (as defined under Qualified Education Expenses , earlier).

If there are qualified education expenses for your dependent during a tax year, either you or your dependent, but not both of you, can claim a lifetime learning credit for your dependent's expenses for that year.

For you to claim a lifetime learning credit for your dependent's expenses, you must also claim your dependent on your tax return. You do this by listing your dependent's name and other required information on Form 1040 or 1040-SR.

If you claim on your tax return an eligible student who is your dependent, treat any expenses paid (or deemed paid) by your dependent as if you had paid them. Include these expenses when figuring the amount of your lifetime learning credit.

If you claim a dependent who is an eligible student, only you can include any expenses you paid when figuring the amount of the lifetime learning credit. If neither you nor anyone else claims the dependent, only the dependent can include any expenses you paid when figuring the lifetime learning credit.

In 2023, Todd’s grandparent makes a payment directly to an eligible educational institution for Todd‘s qualified education expenses. For purposes of claiming a lifetime learning credit, Todd is treated as receiving the money from the grandparent and, in turn, paying the qualified education expenses.

Unless Todd is claimed as a dependent on someone else's 2023 tax return, only Todd can use the payment to claim a lifetime learning credit.

If anyone, such as Todd's parents, claims Todd on their 2023 tax return, whoever claims Todd may be able to use the expenses to claim a lifetime learning credit. If anyone else claims Todd, Todd can't claim a lifetime learning credit.

When an eligible educational institution provides a reduction in tuition to an employee of the institution (or spouse or dependent child of an employee), the amount of the reduction may or may not be taxable. If it is taxable, the employee is treated as receiving a payment of that amount and, in turn, paying it to the educational institution on behalf of the student. For more information on tuition reductions, see Qualified Tuition Reduction in chapter 1 .

The amount of the lifetime learning credit is 20% of the first $10,000 of qualified education expenses you paid for all eligible students. The maximum amount of lifetime learning credit you can claim for 2023 is $2,000 (20% × $10,000). However, that amount may be reduced based on your MAGI. See Effect of the Amount of Your Income on the Amount of Your Credit , later.

Bruce and Toni are married and file a joint tax return. For 2023, their MAGI is $75,000. Toni is attending a local college (an eligible educational institution) to earn credits toward a degree in nursing. Toni already has a bachelor's degree in history and wants to become a nurse. In August 2023, Toni paid $5,000 of qualified education expenses for the fall 2023 semester. Bruce and Toni can claim a $1,000 (20% × $5,000) lifetime learning credit on their 2023 joint tax return.

To help you figure your lifetime learning credit, the student may receive Form 1098-T. Generally, an eligible educational institution (such as a college or university) must send Form 1098-T (or acceptable substitute) to each enrolled student by January 31, 2024. An institution will report payments received (box 1) for qualified education expenses. However, the amount on Form 1098-T might be different from what you paid. When figuring the credit, use only the amounts you paid or are deemed to have paid in 2023 for qualified education expenses.

The eligible educational institution may ask for a completed Form W-9S or similar statement to obtain the student's name, address, and taxpayer identification number.

The amount of your lifetime learning credit is phased out (gradually reduced) if your MAGI is between $80,000 and $90,000 ($160,000 and $180,000 if you file a joint return). You can't claim a lifetime learning credit if your MAGI is $90,000 or more ($180,000 or more if you file a joint return).

Lifetime learning creditModified adjusted gross income (MAGI)Worksheet 3-1 Modified adjusted gross income (MAGI)Lifetime learning creditWorksheet 3-1 WorksheetsLifetime learning credit MAGI calculation (Worksheet 3-1)Worksheet 3-1. MAGI for the Lifetime Learning Credit

If your MAGI is within the range of incomes where the credit must be reduced, you will figure your reduced credit using lines 10–18 of Form 8863. The same method is shown in the following example.

You are filing a joint return with a MAGI of $161,000. In 2023, you paid $6,600 of qualified education expenses.

You figure the tentative lifetime learning credit (20% of the first $10,000 of qualified education expenses you paid for all eligible students). The result is a $1,320 (20% x $6,600) tentative credit.

Because your MAGI is within the range of incomes where the credit must be reduced, you must multiply your tentative credit ($1,320) by a fraction. The numerator (top part) of the fraction is $180,000 (the upper limit for those filing a joint return) minus your MAGI. The denominator (bottom part) is $20,000, the range of incomes for the phaseout ($160,000 to $180,000). The result is the amount of your phased-out (reduced) lifetime learning credit ($1,254).

You claim the lifetime learning credit by completing Form 8863 and submitting it with your Form 1040 or 1040-SR. Enter the credit on Schedule 3 (Form 1040), line 3.

4. Student Loan Interest Deduction

Modified adjusted gross income (MAGI) limits. For 2023, the amount of your student loan interest deduction is gradually reduced (phased out) if your MAGI is between $75,000 and $90,000 ($155,000 and $185,000 if you file a joint return). You can’t claim the deduction if your MAGI is $90,000 or more ($185,000 or more if you file a joint return). For more information, see Figuring the Deduction .

No double benefit allowed. You can’t deduct as interest on a student loan any interest paid by your employer after March 27, 2020, and before January 1, 2026, under an educational assistance program. See No Double Benefit Allowed .

Generally, personal interest you pay, other than certain mortgage interest, isn't deductible on your tax return. However, if your MAGI is less than $90,000 ($185,000 if filing a joint return), you may be allowed a special deduction for paying interest on a student loan (also known as an education loan) used for higher education. For most taxpayers, MAGI is the adjusted gross income (AGI) as figured on their federal income tax return before subtracting any deduction for student loan interest. This deduction can reduce the amount of your income subject to tax by up to $2,500.

The student loan interest deduction is claimed as an adjustment to income. This means you can claim this deduction even if you don't itemize deductions on Schedule A (Form 1040).

What type of loan interest you can deduct,

Whether you can claim the deduction,

What expenses you must have paid with the student loan,

How to figure the deduction, and

How to claim the deduction.

Table 4-1. Student Loan Interest Deduction at a Glance

Student Loan Interest Defined

Student loan interest is interest you paid during the year on a qualified student loan. It includes both required and voluntary interest payments.

Qualified Student Loan

This is a loan you took out solely to pay qualified education expenses (defined later) that were:

For you, your spouse, or a person who was your dependent (as defined later for this purpose) when you took out the loan;

Paid or incurred within a reasonable period of time before or after you took out the loan; and

For education provided during an academic period for an eligible student.

Loans from the following sources aren't qualified student loans.

A related person.

A qualified employer plan.

Generally, your dependent is someone who is either a:

Qualifying child, or

Qualifying relative.

For this purpose, the term “dependent” also includes any person you could have claimed as a dependent on your return except that:

You, or your spouse if filing jointly, could be claimed as a dependent of another taxpayer (like on your parent’s tax return);

The person filed a joint return; or

The person had gross income for the year that was equal to or more than $4,700 (for 2023).

Qualified education expenses are treated as paid or incurred within a reasonable period of time before or after you take out the loan if they are paid with the proceeds of student loans that are part of a federal postsecondary education loan program.

Even if not paid with the proceeds of that type of loan, the expenses are treated as paid or incurred within a reasonable period of time if both of the following requirements are met.

The expenses relate to a specific academic period.

The loan proceeds are disbursed within a period that begins 90 days before the start of that academic period and ends 90 days after the end of that academic period.

If neither of the above situations applies, the reasonable period of time is usually determined based on all the relevant facts and circumstances.

An eligible student is a student who was enrolled at least half-time in a program leading to a degree, certificate, or other recognized educational credential.

You can't deduct interest on a loan you get from a related person. Related persons include:

Your spouse;

Your brothers and sisters;

Your half brothers and half sisters;

Your ancestors (parents, grandparents, etc.);

Your lineal descendants (children, grandchildren, etc.); and

Certain corporations, partnerships, trusts, and exempt organizations.

You can't deduct interest on a loan made under a qualified employer plan or under a contract purchased under such a plan.

For purposes of the student loan interest deduction, these expenses are the total costs of attending an eligible educational institution. They include amounts paid for the following items.

Tuition and fees.

Room and board.

Books, supplies, and equipment.

Other necessary expenses (such as transportation).

The cost of room and board qualifies only to the extent it isn't more than:

The allowance for room and board, as determined by the eligible educational institution, that was included in the cost of attendance (for federal financial aid purposes) for a particular academic period and living arrangement of the student; or

If greater, the actual amount charged if the student is residing in housing owned or operated by the eligible educational institution.

An eligible educational institution is generally any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education. Virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions meet this definition.

For purposes of the student loan interest deduction, an eligible educational institution also includes an institution conducting an internship or residency program leading to a degree or certificate from an institution of higher education, a hospital, or a health care facility that offers postgraduate training.

An educational institution must meet the above criteria only during the academic period(s) for which the student loan was incurred. The deductibility of interest on the loan isn't affected by the institution's subsequent loss of eligibility.

You must reduce your qualified education expenses by the total amount paid for them with the following tax-free items.

Employer-provided educational assistance. See chapter 10 .

Tax-free distribution of earnings from a Coverdell education savings account (ESA). See Tax-Free Distributions in chapter 6 .

Tax-free distribution of earnings from a qualified tuition program (QTP). See Figuring the Taxable Portion of a Distribution in chapter 7 .

U.S. savings bond interest that you exclude from income because it is used to pay qualified education expenses. See chapter 9 .

The tax-free part of scholarships and fellowship grants. See Tax-Free Scholarships and Fellowship Grants in chapter 1 .

Veterans' educational assistance. See Veterans' Benefits in chapter 1 .

Include as Interest

In addition to simple interest on the loan, if all other requirements are met, the items discussed below can be student loan interest.

In general, this is a one-time fee charged by the lender when a loan is made. To be deductible as interest, a loan origination fee must be for the use of money rather than for property or services (such as commitment fees or processing costs) provided by the lender. A loan origination fee treated as interest accrues over the life of the loan.

Loan origination fees weren't required to be reported on Form 1098-E, Student Loan Interest Statement, for loans made before September 1, 2004. If loan origination fees aren't included in the amount reported on your Form 1098-E, you can use any reasonable method to allocate the loan origination fees over the term of the loan.

This is unpaid interest on a student loan that is added by the lender to the outstanding principal balance of the loan. Capitalized interest is treated as interest for tax purposes and is deductible as payments of principal are made on the loan. No deduction for capitalized interest is allowed in a year in which no loan payments were made.

This interest, which includes interest on credit card debt, is student loan interest if the borrower uses the line of credit (credit card) only to pay qualified education expenses. See Qualified Education Expenses , earlier.

This includes interest on a loan used solely to refinance a qualified student loan of the same borrower. It also includes a single consolidation loan used solely to refinance two or more qualified student loans of the same borrower.

The allocation of payments between interest and principal for tax purposes might not be the same as the allocation shown on the Form 1098-E or other statement you receive from the lender or loan servicer. To make the allocation for tax purposes, a payment generally applies first to stated interest that remains unpaid as of the date the payment is due, second to any loan origination fees allocable to the payment, third to any capitalized interest that remains unpaid as of the date the payment is due, and fourth to the outstanding principal.

In August 2022, you took out a $10,000 student loan to pay the tuition for your senior year of college. The lender charged a 3% loan origination fee ($300) that was withheld from the funds you received. The interest (5% simple) on this loan accrued while you completed your senior year and for 6 months after graduating. At the end of that period, the lender determined the amount to be repaid by capitalizing all accrued but unpaid interest ($625 interest accrued from August 2022 through October 2023) and adding it to the outstanding principal balance of the loan. The loan is payable over 60 months, with a payment of $200.51 due on the first of each month, beginning November 2023.

You didn't receive a Form 1098-E for 2023 from the lender because the amount of interest you paid didn't require the lender to issue an information return. However, you did receive an account statement from the lender that showed the following 2023 payments on your outstanding loan of $10,625 ($10,000 principal + $625 accrued but unpaid interest).

To determine the amount of interest that could be deducted on the loan for 2023, you start with the total amount of stated interest you paid, $87.89. Next, allocate the loan origination fee over the term of the loan ($300 ÷ 60 months = $5 per month). A total of $10 ($5 of each of the two principal payments) should be treated as interest for tax purposes. You then apply the unpaid capitalized interest ($625) to the two principal payments in the order in which they were made, and determine that the remaining amount of principal of both payments is treated as interest for tax purposes. Assuming that you qualify to claim the student loan interest deduction, you can deduct $401.02 ($87.89 + $10 + $303.13).

For 2024, you will continue to allocate $5 of the loan origination fee to the principal portion of each monthly payment you make and treat that amount as interest for tax purposes. You will also apply the remaining amount of capitalized interest ($625 − $303.13 = $321.87) to the principal payments in the order in which they are made until the balance is zero, and treat those amounts as interest for tax purposes.

You can't claim a student loan interest deduction for any of the following items.

Interest you paid on a loan if, under the terms of the loan, you aren't legally obligated to make interest payments.

Loan origination fees that are payments for property or services provided by the lender, such as commitment fees or processing costs.

Interest you paid on a loan to the extent payments were made through your participation in the National Health Service Corps Loan Repayment Program (the NHSC Loan Repayment Program) or certain other loan repayment assistance programs. For more information, see Student Loan Repayment Assistance in chapter 5 .

You can deduct all interest you paid during the year on your student loan, including voluntary payments, until the loan is paid off.

Can You Claim the Deduction?

Generally, you can claim the deduction if all of the following requirements are met.

Your filing status is any filing status except married filing separately.

No one else is claiming you as a dependent on their tax return.

You are legally obligated to pay interest on a qualified student loan.

You paid interest on a qualified student loan.

Another taxpayer is claiming you as a dependent if they list your name and other required information on page 1 of their Form 1040, 1040-SR, or 1040-NR.

During 2023, you paid $600 interest on your qualified student loan. Only you are legally obligated to make the payments. No one claimed you as a dependent for 2023. Assuming all other requirements are met, you can deduct the $600 of interest you paid on your 2023 Form 1040 or 1040-SR.

During 2023, you paid $1,100 interest on your qualified student loan. Only you are legally obligated to make the payments. Your parents claimed you as a dependent on their 2023 tax return. In this case, neither you nor your parents may deduct the student loan interest you paid in 2023.

If you are the person legally obligated to make interest payments and someone else makes a payment of interest on your behalf, you are treated as receiving the payments from the other person and, in turn, paying the interest.

You obtained a qualified student loan to attend college. After graduating from college, you worked as an intern for a nonprofit organization. As part of the internship program, the nonprofit organization made an interest payment on your behalf. This payment was treated as additional compensation and reported in box 1 of your Form W-2. Assuming all other qualifications are met, you can deduct this payment of interest on your tax return.

You obtained a qualified student loan to attend college. After graduating from college, the first monthly payment on the loan was due in December. As a gift, your mother made this payment. No one is claiming you as a dependent on their tax return. Assuming all other qualifications are met, you can deduct this payment of interest on your tax return.

You can't deduct as interest on a student loan any amount that is an allowable deduction under any other provision of the tax law (for example, home mortgage interest).

You also can't deduct as interest on a student loan any amount paid from a distribution of earnings made from a QTP after 2018 to the extent the earnings are treated as tax free because they were used to pay student loan interest. For more information, see chapter 7 .

For payments made after March 27, 2020, and before January 1, 2026, do not deduct as interest on a student loan any interest paid by your employer under an educational assistance program. See chapter 10 .

Figuring the Deduction

Your student loan interest deduction is generally the smaller of:

The interest you paid during the tax year.

To help you figure your student loan interest deduction, you should receive Form 1098-E. Generally, an institution (such as a bank or governmental agency) that received interest payments of $600 or more during 2023 on one or more qualified student loans must send Form 1098-E (or an acceptable substitute) to each borrower by January 31, 2024.

For qualified student loans taken out before September 1, 2004, the institution is required to include on Form 1098-E only payments of stated interest. Other interest payments, such as certain loan origination fees and capitalized interest, may not appear on the form you receive. However, if you pay qualifying interest that isn't included on Form 1098-E, you can also deduct those amounts. See Allocating Payments Between Interest and Principal , earlier.

The lender may ask for a completed Form W-9S or similar statement to obtain the borrower's name, address, and taxpayer identification number. The form may also be used by the borrower to certify that the student loan was incurred solely to pay for qualified education expenses.

Effect of the Amount of Your Income on the Amount of Your Deduction

The amount of your student loan interest deduction is phased out (gradually reduced) if your MAGI is between $75,000 and $90,000 ($155,000 and $185,000 if you file a joint return). You can't claim a student loan interest deduction if your MAGI is $90,000 or more ($185,000 or more if you file a joint return).

For most taxpayers, MAGI is AGI as figured on their federal income tax return before subtracting any deduction for student loan interest. However, as discussed below, there may be other modifications.

Table 4-2 shows how the amount of your MAGI can affect your student loan interest deduction.

Table 4-2. Effect of MAGI on Student Loan Interest Deduction

If you file Form 1040 or 1040-SR, your MAGI is the AGI on line 11 of that form figured without taking into account any amount on Schedule 1 (Form 1040), line 21 (student loan interest deduction), and modified by adding back any:

If you file Form 1040-NR, your MAGI is the AGI on line 11 of that form figured without taking into account any amount on Schedule 1 (Form 1040), line 21 (student loan interest deduction).

If your MAGI is within the range of incomes where the credit must be reduced, you must figure your reduced deduction. To figure the phaseout, multiply your interest deduction (before the phaseout, but not more than $2,500) by a fraction. The numerator (top part) is your MAGI minus $75,000 ($155,000 in the case of a joint return). The denominator (bottom part) is $15,000 ($30,000 in the case of a joint return). Subtract the result from your deduction (before the phaseout) to give you the amount you can deduct.

During 2023, you paid $800 interest on a qualified student loan. Your 2023 MAGI is $170,000 and you are filing a joint return. You must reduce your deduction by $400, figured as follows.

The facts are the same as in Example 1 , except that you paid $2,750 interest. Your maximum deduction for 2023 is $2,500. You must reduce your maximum deduction by $1,250, figured as follows.

Generally, you figure the deduction using the Student Loan Interest Deduction Worksheet in the Schedule 1 (Form 1040) instructions included in the Instructions for Form 1040. However, if you are filing Form 2555, Foreign Earned Income; Form 4563, Exclusion of Income for Bona Fide Residents of American Samoa; or you are excluding income from sources within Puerto Rico, you must complete Worksheet 4-1.

The student loan interest deduction is an adjustment to income. To claim the deduction, enter the allowable amount on Schedule 1 (Form 1040), line 21.

Student loan interest deductionWorksheet 4-1 WorksheetsStudent loan interest deduction (Worksheet 4-1)Worksheet 4-1. Student Loan Interest Deduction Worksheet

5. Student Loan Cancellations and Repayment Assistance

Student loan forgiveness. The American Rescue Plan Act of 2021 modified the treatment of student loan forgiveness for discharges in 2021 through 2025.

Generally, if you are responsible for making loan payments, and the loan is canceled or repaid by someone else, you must include the amount that was canceled or paid on your behalf in your gross income for tax purposes. However, in certain circumstances, you may be able to exclude this amount from gross income if the loan was one of the following.

A loan for postsecondary educational expenses.

A private education loan.

A loan from an educational organization described in section 170(b)(1)(A)(ii).

A loan from an organization exempt from tax under section 501(a) to refinance a student loan.

Loan for Postsecondary Educational Expenses

This is any loan provided expressly for postsecondary education, regardless of whether provided through the educational institution or directly to the borrower, if such loan was made, insured, or guaranteed by one of the following.

The United States, or an instrumentality or agency thereof.

A state or territory of the United States; or the District of Columbia; or any political subdivision thereof.

An eligible educational institution.

Private Education Loan

A private education loan is a loan provided by a private educational lender that:

Is not made, insured, or guaranteed under Title IV of the Higher Education Act of 1965; and

Is issued expressly for postsecondary educational expenses to a borrower, regardless of whether the loan is provided through the educational institution that the student attends or directly to the borrower from the private educational lender. A private education loan does not include an extension of credit under an open-end consumer credit plan, a reverse mortgage transaction, a residential mortgage transaction, or any other loan that is secured by real property or a dwelling.

A private educational lender is one of the following.

A financial institution that solicits, makes, or extends private education loans.

A federal credit union that solicits, makes, or extends private education loans.

Any other person engaged in the business of soliciting, making, or extending private education loans.

Loan From an Educational Organization Described in Section 170(b)(1)(A)(ii)

This is any loan made by the organization if the loan is made:

As part of an agreement with an entity described earlier under which the funds to make the loan were provided to the educational organization, or

Under a program of the educational organization that is designed to encourage its students to serve in occupations with unmet needs or in areas with unmet needs where the services provided by the students (or former students) are for or under the direction of a governmental unit or a tax-exempt section 501(c)(3) organization.

This is an educational institution that maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it carries on its educational activities.

This is any corporation, community chest, fund, or foundation organized and operated exclusively for one or more of the following purposes.

Charitable.

Educational.

Scientific.

Testing for public safety.

Fostering national or international amateur sports competition (but only if none of its activities involve providing athletic facilities or equipment).

The prevention of cruelty to children or animals.

If you refinanced a student loan with another loan from an educational organization or a tax-exempt organization, the cancellation of that loan may also be treated as discussed above. This applies if the new loan is made under a program of the refinancing organization that is designed to encourage students to serve in occupations with unmet needs or in areas with unmet needs where the services required of the students are for or under the direction of a governmental unit or a tax-exempt section 501(c)(3) organization (defined earlier).

Student loan repayments made to you are tax free if you received them for any of the following.

The National Health Service Corps Loan Repayment Program (NHSC Loan Repayment Program).

A state education loan repayment program eligible for funds under the Public Health Service Act.

Any other state loan repayment or loan forgiveness program that is intended to provide for the increased availability of health services in underserved or health professional shortage areas (as determined by such state).

6. Coverdell Education Savings Account (ESA)

If your modified adjusted gross income (MAGI) is less than $110,000 ($220,000 if filing a joint return), you may be able to establish a Coverdell ESA to finance the qualified education expenses of a designated beneficiary. For most taxpayers, MAGI is the adjusted gross income (AGI) as figured on their federal income tax return.

Total contributions for the beneficiary in any year can't be more than $2,000, no matter how many separate Coverdell ESAs have been established for the beneficiary. See Contributions , later.

Contributions to a Coverdell ESA aren't deductible, but amounts deposited in the account grow tax free until distributed.

If, for a year, distributions from an account aren't more than a designated beneficiary's adjusted qualified education expenses (AQEE) at an eligible educational institution, the beneficiary won't owe tax on the distributions. See Tax-Free Distributions , later.

Table 6-1 summarizes the main features of the Coverdell ESA.

Table 6-1. Coverdell ESA at a Glance

What Is a Coverdell ESA?

A Coverdell ESA is a trust or custodial account created or organized in the United States only for the purpose of paying the qualified education expenses of the Designated beneficiary (defined later) of the account.

When the account is established, the designated beneficiary must be under age 18 or a special needs beneficiary.

To be treated as a Coverdell ESA, the account must be designated as a Coverdell ESA when it is created.

The document creating and governing the account must be in writing and must satisfy the following requirements.

The trustee or custodian must be a bank or an entity approved by the IRS.

The document must provide that the trustee or custodian can only accept a contribution that meets all of the following conditions.

The contribution is in cash.

The contribution is made before the beneficiary reaches age 18, unless the beneficiary is a special needs beneficiary.

The contribution wouldn't result in total contributions for the year (not including rollover contributions) being more than $2,000.

Money in the account can't be invested in life insurance contracts.

Money in the account can't be combined with other property except in a common trust fund or common investment fund.

The balance in the account must generally be distributed within 30 days after the earlier of the following events.

The beneficiary reaches age 30, unless the beneficiary is a special needs beneficiary.

The beneficiary's death.

Generally, these are expenses required for the enrollment or attendance of the designated beneficiary at an eligible educational institution. The expenses can be either qualified higher education expenses or qualified elementary and secondary education expenses.

This is the individual named in the document creating the trust or custodial account to receive the benefit of the funds in the account.

A contribution to a QTP is a qualified education expense if the contribution is on behalf of the designated beneficiary of the Coverdell ESA. In the case of a change in beneficiary, this is a qualified expense only if the new beneficiary is a family member of that designated beneficiary. See chapter 7 .

Eligible Educational Institution

An eligible educational institution can be either an eligible postsecondary school or an eligible elementary or secondary school.

An eligible postsecondary school is generally any accredited public, nonprofit, or proprietary (privately owned profit-making) college, university, vocational school, or other postsecondary educational institution. Also, the institution must be eligible to participate in a student aid program administered by the U.S. Department of Education. Virtually all accredited postsecondary institutions meet this definition. The educational institution should be able to tell you if it is an eligible educational institution.

An eligible elementary or secondary school is any public, private, or religious school that provides elementary or secondary education (kindergarten through grade 12), as determined under state law.

Qualified Higher Education Expenses

These are expenses related to enrollment or attendance at an eligible postsecondary school. As shown in the following list, to be qualified, some of the expenses must be required by the school and some must be incurred by students who are enrolled at least half-time.

The following expenses must be required for enrollment or attendance of a designated beneficiary at an eligible postsecondary school.

Expenses for special needs services needed by a special needs beneficiary must be incurred in connection with enrollment or attendance at an eligible postsecondary school.

Expenses for room and board must be incurred by students who are enrolled at least half-time (defined below).

The expense for room and board qualifies only to the extent that it isn't more than the greater of the following two amounts.

The allowance for room and board, as determined by the school, that was included in the cost of attendance (for federal financial aid purposes) for a particular academic period and living arrangement of the student.

The actual amount charged if the student is residing in housing owned or operated by the school.

The purchase of computer or peripheral equipment, computer software, or Internet access and related services if it is to be used primarily by the beneficiary during any of the years the beneficiary is enrolled at an eligible postsecondary school. (This doesn’t include expenses for computer software for sports, games, or hobbies unless the software is predominantly educational in nature.)

A student is enrolled “at least half-time” if he or she is enrolled for at least half the full-time academic workload for the course of study the student is pursuing, as determined under the standards of the school where the student is enrolled.

These are expenses related to enrollment or attendance at an eligible elementary or secondary school. As shown in the following list, to be qualified, some of the expenses must be required or provided by the school. There are special rules for computer-related expenses.

The following expenses must be incurred by a designated beneficiary in connection with enrollment or attendance at an eligible elementary or secondary school.

Academic tutoring.

Special needs services for a special needs beneficiary.

The following expenses must be required or provided by an eligible elementary or secondary school in connection with attendance or enrollment at the school.

Transportation.

Supplementary items and services (including extended day programs).

The purchase of computer or peripheral equipment, computer software, fiber optic cables related to computer use, or Internet access and related services is a qualified elementary and secondary education expense if it is to be used by the beneficiary and the beneficiary's family during any of the years the beneficiary is in elementary or secondary school. (This doesn't include expenses for computer software designed for sports, games, or hobbies unless the software is predominantly educational in nature.)

Contributions

Any individual (including the designated beneficiary) can contribute to a Coverdell ESA if the individual's MAGI (defined later under Contribution Limits ) for the year is less than $110,000. For individuals filing joint returns, that amount is $220,000.

Organizations, such as corporations and trusts, can also contribute to Coverdell ESAs. There is no requirement that an organization's income be below a certain level.

Contributions must meet all of the following requirements.

They must be in cash.

They can't be made after the beneficiary reaches age 18, unless the beneficiary is a special needs beneficiary.

They must be made by the due date of the contributor's tax return (not including extensions).

Contributions can be made to one or several Coverdell ESAs for the same designated beneficiary provided that the total contributions aren't more than the contribution limits (defined later) for a year.

Contributions can be made, without penalty, to both a Coverdell ESA and a QTP in the same year for the same beneficiary.

Table 6-2 summarizes many of the features of contributing to a Coverdell ESA.

Table 6-2. Coverdell ESA Contributions at a Glance

Contributions made to a Coverdell ESA for the preceding tax year are considered to have been made on the last day of the preceding year. They must be made by the due date (not including extensions) for filing your return for the preceding year.

For example, if you make a contribution to a Coverdell ESA in February 2024, and you designate it as a contribution for 2023, you are considered to have made that contribution on December 31, 2023.

Contribution Limits

There are two yearly limits.

One on the total amount that can be contributed for each designated beneficiary in any year.

One on the amount that any individual can contribute for any one designated beneficiary for a year.

For 2023, the total of all contributions to all Coverdell ESAs set up for the benefit of any one designated beneficiary can't be more than $2,000. This includes contributions (other than rollovers) to all the beneficiary's Coverdell ESAs from all sources. Rollovers are discussed under Rollovers and Other Transfers , later.

When a beneficiary was born in 2022, three separate Coverdell ESAs were set up, one by the parents, one by a grandparent, and one by an aunt. In 2023, the total of all contributions to the three Coverdell ESAs can't be more than $2,000. For example, if the grandparent contributed $2,000 to one of the Coverdell ESAs, no one else could contribute to any of the three accounts. Or, if the parents contributed $1,000 and the aunt $600, the grandparent or someone else could contribute no more than $400. These contributions could be put into any of the beneficiary's Coverdell ESA accounts.

Generally, you can contribute up to $2,000 for each designated beneficiary for 2023. This is the most you can contribute for the benefit of any one beneficiary for the year, regardless of the number of Coverdell ESAs set up for the beneficiary.

The facts are the same as in the previous example except that the beneficiary's older sibling also has a Coverdell ESA. If the grandparent contributed $2,000 to the beneficiary's Coverdell ESA in 2023, the grandparent could also contribute $2,000 to the sibling's Coverdell ESA.

Your contribution limit may be reduced. If your MAGI (defined later) is between $95,000 and $110,000 (between $190,000 and $220,000 if filing a joint return), the $2,000 limit for each designated beneficiary is gradually reduced (see Figuring the limit , later). If your MAGI is $110,000 or more ($220,000 or more if filing a joint return), you can't contribute to anyone's Coverdell ESA.

If you have any of these adjustments, you can use Worksheet 6-1 to figure your MAGI for Form 1040 or 1040-SR.

If you file Form 1040-NR, your MAGI is the AGI on line 11 of that form.

Coverdell education savings account (ESA)Modified adjusted gross income (MAGI)Worksheet 6-2 Modified adjusted gross income (MAGI)Coverdell ESAWorksheet 6-1 WorksheetsCoverdell ESAMAGI, calculation of (Worksheet 6-1) Coverdell education savings account (ESA)Contribution limitsFiguring the limit (Worksheet 6-1)Worksheet 6-1. MAGI for a Coverdell ESA

Figuring the limit.

To figure the limit on the amount you can contribute for each designated beneficiary, multiply $2,000 by a fraction. The numerator (top part) is your MAGI minus $95,000 ($190,000 if filing a joint return). The denominator (bottom part) is $15,000 ($30,000 if filing a joint return). Subtract the result from $2,000. This is the amount you can contribute for each beneficiary. You can use Worksheet 6-2 to figure the limit on contributions.

WorksheetsCoverdell ESAContribution limit (Worksheet 6-2)Worksheet 6-2. Coverdell ESA Contribution Limit

A taxpayer filing as single had MAGI of $96,500 for 2023. The taxpayer can contribute up to $1,800 in 2023 for each beneficiary, as shown in the illustrated Worksheet 6-2 .

Worksheet 6-2. Coverdell ESA Contribution Limit—Illustrated

Additional Tax on Excess Contributions

The beneficiary may owe a 6% excise tax each year on excess contributions that are in a Coverdell ESA at the end of the year. Excess contributions are the total of the following two amounts.

Contributions to any designated beneficiary's Coverdell ESA for the year that are more than $2,000 (or, if less, the total of each contributor's limit for the year, as discussed earlier).

Excess contributions for the preceding year, reduced by the total of the following two amounts.

Distributions (other than those rolled over, as discussed later) during the year.

The contribution limit for the current year minus the amount contributed for the current year.

The excise tax doesn't apply if excess contributions made during 2023 (and any earnings on them) are distributed before the first day of the sixth month of the following tax year (June 1, 2024, for a calendar year taxpayer).

However, you must include the distributed earnings in gross income for the year in which the excess contribution was made. You should receive Form 1099-Q, Payments From Qualified Education Programs, from each institution from which excess contributions were distributed. Box 2 of that form will show the amount of earnings on your excess contributions. Code “2” or “3” entered in the blank box below boxes 5 and 6 indicates the year in which the earnings are taxable. See Instructions for Recipient of your Form 1099-Q, on the back of Copy B. Enter the amount of earnings on Schedule 1 (Form 1040), line 8z, for the applicable tax year. For more information, see Taxable Distributions , later.

The excise tax doesn't apply to any rollover contribution.

Contributions made in one year for the preceding tax year are considered to have been made on the last day of the preceding year.

In 2022, your parents and grandparents contributed a total of $2,300 to your Coverdell ESA—an excess contribution of $300. Because you didn't withdraw the excess before June 1, 2023, you had to pay an additional tax of $18 (6% × $300) when you filed your 2022 tax return.

In 2023, excess contributions of $500 were made to your account; however, you withdrew $250 from that account to use for qualified education expenses. Using the steps shown earlier under Additional Tax on Excess Contributions , you figure the excess contribution in your account at the end of 2023 as follows.

You figure this excise tax on Form 5329, Part V. Report the additional tax on Schedule 2 (Form 1040), line 8.

Rollovers and Other Transfers

Assets can be rolled over from one Coverdell ESA to another or the designated beneficiary can be changed. The beneficiary's interest can be transferred to a spouse or former spouse because of divorce.

Any amount distributed from a Coverdell ESA isn't taxable if it is rolled over to another Coverdell ESA for the benefit of the same beneficiary or a member of the beneficiary's family (including the beneficiary's spouse) who is under age 30. This age limitation doesn't apply if the new beneficiary is a special needs beneficiary.

An amount is rolled over if it is paid to another Coverdell ESA within 60 days after the date of the distribution.

Don't report qualifying rollovers (those that meet the above criteria) anywhere on Form 1040, 1040-SR, or 1040-NR. These aren't taxable distributions.

For these purposes, the beneficiary's family includes the beneficiary's spouse and the following other relatives of the beneficiary.

Son, daughter, stepchild, foster child, adopted child, or a descendant of any of them.

Brother, sister, stepbrother, or stepsister.

Father or mother or ancestor of either.

Stepfather or stepmother.

Son or daughter of a brother or sister.

Brother or sister of father or mother.

Son-in-law, daughter-in-law, father-in-law, mother-in-law, brother-in-law, or sister-in-law.

The spouse of any individual listed above.

First cousin.

When you graduated from college in January last year, you had $5,000 left in your Coverdell ESA. You wanted to give this money to your younger sibling, who was still in high school. In order to avoid paying tax on the distribution of the amount remaining in your account, you contributed the same amount to your sibling’s Coverdell ESA within 60 days of the distribution.

If you received a military death gratuity or a payment from SGLI, you may roll over all or part of the amount received to one or more Coverdell ESAs for the benefit of members of the beneficiary's family (see Members of the beneficiary's family , earlier). Such payments are made to an eligible survivor upon the death of a member of the U.S. Armed Forces. The contribution to a Coverdell ESA from survivor benefits received can't be made later than 1 year after the date on which you receive the gratuity or SGLI payment.

This rollover contribution isn't subject to (but is in addition to) the contribution limits discussed earlier under Contribution Limits . The amount you roll over can't exceed the total survivor benefits you received, reduced by contributions from these benefits to a Roth IRA or other Coverdell ESAs.

The amount contributed from the survivor benefits is treated as part of your basis (cost) in the Coverdell ESA, and won't be taxed when distributed. See Distributions , later.

The designated beneficiary can be changed. See Members of the beneficiary's family , earlier. There aren't any tax consequences if, at the time of the change, the new beneficiary is under age 30 or is a special needs beneficiary.

Assume the same situation as in the last example (see Rollovers , earlier). Instead of closing your Coverdell ESA and paying the distribution into your sibling’s Coverdell ESA, you could have instructed the trustee of your account to simply change the name of the beneficiary on your account to that of your sibling.

If a spouse or former spouse receives a Coverdell ESA under a divorce or separation instrument, it isn't a taxable transfer. After the transfer, the spouse or former spouse treats the Coverdell ESA as their own.

In their divorce settlement, Taxpayer A received Taxpayer B’s Coverdell ESA. In this process, the account was transferred into Taxpayer A’s name. Taxpayer A now treats the funds in this Coverdell ESA as if they were the original owner.

Distributions

The designated beneficiary of a Coverdell ESA can take a distribution at any time. Whether the distributions are tax free depends, in part, on whether the distributions are equal to or less than the amount of Adjusted qualified education expenses (AQEE) (defined later) the beneficiary has in the same tax year.

See Table 6-3 for highlights.

Table 6-3. Coverdell ESA Distributions at a Glance

To determine if total distributions for the year are more than the amount of qualified education expenses, reduce total qualified education expenses by any tax-free educational assistance. Tax-free educational assistance includes:

Veterans' educational assistance (see Veterans' Benefits in chapter 1 );

Employer-provided educational assistance (see chapter 10 ); and

The amount you get by subtracting tax-free educational assistance from your total qualified education expenses is your AQEE.

Generally, distributions are tax free if they aren't more than the beneficiary's AQEE for the year. Don't report tax-free distributions (including qualifying rollovers) on your tax return.

Taxable Distributions

A portion of the distributions is generally taxable to the beneficiary if the total distributions are more than the beneficiary's AQEE for the year.

This is the part of the total distribution that is more than the beneficiary's AQEE for the year.

You will receive a Form 1099-Q for each of the Coverdell ESAs from which money was distributed in 2023. The amount of your gross distribution will be shown in box 1. For 2023, instead of dividing the gross distribution between your earnings (box 2) and your basis (amount already taxed) (box 3), the payer or trustee may report the fair market value (account balance) of the Coverdell ESA as of December 31, 2023. This will be shown in the blank box below boxes 5 and 6.

The amount contributed from survivor benefits (see Military death gratuity , earlier) is treated as part of your basis and won't be taxed when distributed.

The taxable portion is the amount of the excess distribution that represents earnings that have accumulated tax free in the account. Figure the taxable portion for 2023 as shown in the following steps.

Multiply the total amount distributed by a fraction. The numerator (top part) is the basis (contributions not previously distributed) at the end of 2022, plus total contributions for 2023, and the denominator (bottom part) is the value (balance) of the account at the end of 2023 plus the amount distributed during 2023.

Subtract the amount figured in (1) from the total amount distributed during 2023. The result is the amount of earnings included in the distribution(s).

Multiply the amount of earnings figured in (2) by a fraction. The numerator (top part) is the AQEE paid during 2023, and the denominator (bottom part) is the total amount distributed during 2023.

Subtract the amount figured in (3) from the amount figured in (2). The result is the amount the beneficiary must include in income.

The taxable amount must be reported on Schedule 1 (Form 1040), line 8z.

You received an $850 distribution from your Coverdell ESA, to which $1,500 had been contributed before 2023. There were no contributions in 2023. This is your first distribution from the account, so your basis in the account on December 31, 2022, was $1,500. The value (balance) of your account on December 31, 2023, was $950. You had $700 of AQEE for the year. Using the steps in Figuring the Taxable Portion of a Distribution , earlier, figure the taxable portion of your distribution as follows.

Worksheet 6-3 , at the end of this chapter, can help you figure your AQEE, how much of your distribution must be included in income, and the remaining basis in your Coverdell ESA(s).

The American opportunity or lifetime learning credit can be claimed in the same year the beneficiary takes a tax-free distribution from a Coverdell ESA, as long as the same expenses aren't used for both benefits. This means the beneficiary must reduce qualified higher education expenses (QHEE) by tax-free educational assistance, and then further reduce them by any expenses taken into account in determining an American opportunity or lifetime learning credit.

In 2023, during your first year in college you had $5,800 of QHEE. You paid your college expenses from the following sources.

Before you can determine the taxable portion of your Coverdell ESA distribution, you must reduce your total QHEE.

If a designated beneficiary receives distributions from both a Coverdell ESA and a QTP in the same year, and the total distribution is more than the beneficiary's AQEE, those expenses must be allocated between the distribution from the Coverdell ESA and the distribution from the QTP before figuring how much of each distribution is taxable. The following two examples illustrate possible allocations.

In 2023, you graduated from high school and began your first semester of college. That year, you had $1,000 of qualified elementary and secondary education expenses (QESEE) for high school and $3,000 of QHEE for college. Your QESEE doesn't include tuition. To pay these expenses, you withdrew $800 from your Coverdell ESA and $4,200 from your QTP. No one claimed you as a dependent, nor were you eligible for an education credit. You didn't receive any tax-free educational assistance in 2023. You must allocate your total qualified education expenses between the two distributions.

You know that tax-free treatment will be available if you apply your $800 Coverdell ESA distribution toward your $1,000 of qualified education expenses for high school. The qualified expenses are greater than the distribution, making the $800 Coverdell ESA distribution tax free.

Next, you match your $4,200 QTP distribution to your $3,000 of QHEE, and find you have an excess QTP distribution of $1,200 ($4,200 QTP − $3,000 QHEE). You can't use the extra $200 of high school expenses (from (1) above) against the QTP distribution because those expenses are not high school tuition expenses and don't qualify a QTP for tax-free treatment.

Finally, you figure the taxable and tax-free portions of your QTP distribution based on your $3,000 of QHEE. (See Figuring the Taxable Portion of a Distribution in chapter 7 for more information.)

Assume the same facts as in Example 1 , except that you withdrew $1,800 from your Coverdell ESA and $3,200 from your QTP. In this case, you allocate your qualified education expenses as follows.

Using the same reasoning as in Example 1 , you match $1,000 of your Coverdell ESA distribution to your $1,000 of QESEE—you have $800 of your distribution remaining.

Because higher education expenses can also qualify a Coverdell ESA distribution for tax-free treatment, you allocate your $3,000 of QHEE between the remaining $800 Coverdell ESA and the $3,200 QTP distributions ($4,000 total).

You then figure the taxable part of the following.

Coverdell ESA distribution based on qualified education expenses of $1,600 ($1,000 QESEE + $600 QHEE). See Figuring the Taxable Portion of a Distribution , earlier, in this chapter.

QTP distribution based on her $2,400 of QHEE (see Figuring the Taxable Portion of a Distribution in chapter 7 ).

For tax years beginning after 2017 and before 2026, if you have a loss on your investment in a Coverdell ESA, you can’t deduct the loss on your income tax return. You have a loss only when all amounts from that account have been distributed and the total distributions are less than your unrecovered basis. Your basis is the total amount of contributions to that Coverdell ESA.

Additional Tax on Taxable Distributions

Generally, if you receive a taxable distribution, you must also pay a 10% additional tax on the amount included in income.

The 10% additional tax doesn't apply to the following distributions.

Paid to a beneficiary (or to the estate of the designated beneficiary) on or after the death of the designated beneficiary.

Made because the designated beneficiary is disabled. A person is considered to be disabled if proof is provided showing there is a physical or mental impairment that substantially limits any gainful activity. A physician must determine that the person's condition can be expected to result in death or to be of long-continued and indefinite duration.

Included in income because the designated beneficiary received:

A tax-free scholarship or fellowship grant (see Tax-Free Scholarships and Fellowship Grants in chapter 1 );

Employer-provided educational assistance (see chapter 10 ); or

This exception applies only to the extent the distribution isn't more than the scholarship, allowance, or payment.

Made on account of the attendance of the designated beneficiary at a U.S. military academy (such as the USMA at West Point). This exception applies only to the extent that the amount of the distribution doesn't exceed the costs of advanced education (as defined in section 2005(d)(3) of title 10 of the U.S. Code) attributable to such attendance.

Included in income only because the qualified education expenses were taken into account in determining the American opportunity or lifetime learning credit (see Coordination With American Opportunity and Lifetime Learning Credits , earlier).

Made before June 1, 2024, of an excess 2023 contribution (and any earnings on it). The distributed earnings must be included in gross income for the year in which the excess contribution was made.

Use Part II of Form 5329 to figure any additional tax. Report the amount on Schedule 2 (Form 1040), line 8.

When Assets Must Be Distributed

Any assets remaining in a Coverdell ESA must be distributed when either one of the following two events occurs.

The designated beneficiary reaches age 30. In this case, the remaining assets must be distributed within 30 days after the beneficiary reaches age 30. However, this rule doesn't apply if the beneficiary is a special needs beneficiary.

The designated beneficiary dies. In this case, the remaining assets must generally be distributed within 30 days after the date of death.

If a Coverdell ESA is transferred to a surviving spouse or other family member as the result of the death of the designated beneficiary, the Coverdell ESA retains its status. (“Family member” was defined earlier under Rollovers .) This means the spouse or other family member can treat the Coverdell ESA as their own and doesn't need to withdraw the assets until they reach age 30. This age limitation doesn't apply if the new beneficiary is a special needs beneficiary. There are no tax consequences as a result of the transfer.

When a total distribution is made because the designated beneficiary either reached age 30 or died, the earnings that accumulated tax free in the account must be included in taxable income. You determine these earnings as shown in the following two steps.

Multiply the amount distributed by a fraction. The numerator (top part) is the basis (contributions not previously distributed) at the end of 2022 plus total contributions for 2023, and the denominator (bottom part) is the balance in the account at the end of 2023 plus the amount distributed during 2023.

Subtract the amount figured in (1) from the total amount distributed during 2023. The result is the amount of earnings included in the distribution.

For an example, see steps 1 and 2 of the Example under Figuring the Taxable Portion of a Distribution , earlier.

The beneficiary or other person receiving the distribution must report this amount on Schedule 1 (Form 1040), line 8z, listing the type and amount of income.

Worksheet 6-3 Instructions. Coverdell ESA—Taxable Distributions and Basis

Coverdell education savings account (ESA)Figuring taxable portion of distributionWorksheet 6-3 Coverdell education savings account (ESA)Taxable distributionsWorksheet 6-3 to figure WorksheetsCoverdell ESATaxable distributions and basis (Worksheet 6-3)Worksheet 6-3. Coverdell ESA—Taxable Distributions and Basis

7. Qualified Tuition Program (QTP)

Rollover to Roth IRA. The Secure 2.0 Act of 2022 updated section 529. For distributions after 12/31/2023, section 529(c)(3)(E) outlines a new rollover provision from long-term Qualified Tuition Programs to Roth IRAs.

QTPs are also called 529 plans. States may establish and maintain programs that allow you to either prepay or contribute to an account for paying a student's qualified education expenses at an eligible educational institution. Eligible educational institutions may establish and maintain programs that allow you to prepay a student's qualified education expenses. If you prepay tuition, the student (designated beneficiary) will be entitled to a waiver or a payment of qualified education expenses. You can't deduct either payments or contributions to a QTP. For information on a specific QTP, you will need to contact the state agency or eligible educational institution that established and maintains it.

No tax is due on a distribution from a QTP unless the amount distributed is greater than the beneficiary's adjusted qualified education expenses (AQEE). See Are Distributions Taxable , later, for more information.

What Is a QTP?

A QTP is a program set up to allow you to either prepay or contribute to an account established for paying a student's qualified education expenses at an eligible educational institution. QTPs can be established and maintained by states (or agencies or instrumentalities of a state) and eligible educational institutions. The program must meet certain requirements. Your state government or the eligible educational institution in which you are interested can tell you whether or not they participate in a QTP.

Generally, these are expenses required for the enrollment or attendance of the designated beneficiary at an eligible educational institution. For purposes of QTPs, the expenses can be either qualified higher education expenses or qualified elementary and secondary education expenses.

The designated beneficiary is generally the student (or future student) for whom the QTP is intended to provide benefits. The designated beneficiary can be changed after participation in the QTP begins. If a state or local government or certain tax-exempt organizations purchase an interest in a QTP as part of a scholarship program, the designated beneficiary is the person who receives the interest as a scholarship.

For purposes of a QTP, an eligible educational institution can be either an eligible postsecondary school or an eligible elementary or secondary school.

An eligible postsecondary school is generally any accredited public, nonprofit, or proprietary (privately owned profit-making) college, university, vocational school, or other postsecondary educational institution. Also, the institution must be eligible to participate in a student aid program administered by the U.S. Department of Education. Virtually all accredited postsecondary institutions meet this definition. The educational institution should be able to tell you if it’s an eligible educational institution.

These are expenses related to enrollment or attendance at an eligible postsecondary school. As shown in the following list, to be qualified, some of the expenses must be required by the school and some must be incurred by students who are enrolled at least half-time, defined later.

Expenses for room and board must be incurred by students who are enrolled at least half-time (defined later).

You may need to contact the eligible educational institution for qualified room and board costs.

The purchase of computer or peripheral equipment, computer software, or Internet access and related services, if it's to be used primarily by the beneficiary during any of the years the beneficiary is enrolled at an eligible postsecondary school. (This doesn't include expenses for computer software for sports, games, or hobbies unless the software is predominantly educational in nature.)

The expenses for fees, books, supplies, and equipment required for the designated beneficiary’s participation in an apprenticeship program registered and certified with the Secretary of Labor under section 1 of the National Apprenticeship Act.

No more than $10,000 paid as principal or interest on qualified student loans of the designated beneficiary or the designated beneficiary’s sibling. A sibling includes a brother, sister, stepbrother, or stepsister. For purposes of the $10,000 limitation, amounts treated as a qualified higher education expense for the loans of a sibling are taken into account for the sibling and not for the designated beneficiary. You can’t deduct as interest on a student loan (see chapter 4 ) any amount paid from a distribution of earnings from a QTP after 2018 to the extent the earnings are treated as tax free because they were used to pay student loan interest.

A student is enrolled “at least half-time” if the student is enrolled for at least half the full-time academic workload for the course of study the student is pursuing, as determined under the standards of the school where the student is enrolled.

These are expenses for no more than $10,000 of tuition, incurred by a designated beneficiary, in connection with enrollment or attendance at an eligible elementary or secondary school.

Contributions to a QTP on behalf of any beneficiary can't be more than the amount necessary to provide for the qualified education expenses of the beneficiary. There are no income restrictions on the individual contributors.

You can contribute to both a QTP and a Coverdell education savings account (ESA) in the same year for the same designated beneficiary.

If a student receives a refund of qualified education expenses that were treated as paid by a QTP distribution, the student can recontribute these amounts into any QTP for which they are the beneficiary within 60 days after the date of the refund to avoid the need to figure the taxable part of the QTP distribution.

Are Distributions Taxable?

The part of a distribution representing the amount paid or contributed to a QTP doesn't have to be included in income. This is a return of the investment in the plan.

The designated beneficiary generally doesn't have to include in income any earnings distributed from a QTP if the total distribution is less than or equal to AQEE (defined under Figuring the Taxable Portion of a Distribution , below).

You will receive a Form 1099-Q from each of the programs from which you received a QTP distribution in 2023. The amount of your gross distribution (box 1) shown on each form will be divided between your earnings (box 2) and your basis, or return of investment (box 3). Form 1099-Q should be sent to you by January 31, 2024.

To determine if total distributions for the year are more or less than the amount of qualified education expenses, you must compare the total of all QTP distributions for the tax year to the AQEE.

This amount is the total qualified education expenses reduced by any tax-free educational assistance. Tax-free educational assistance includes:

Use the following steps to figure the taxable part.

Multiply the total distributed earnings shown in box 2 of Form 1099-Q by a fraction. The numerator (top part) is the AQEE paid during the year, and the denominator (bottom part) is the total amount distributed during the year.

Subtract the amount figured in (1) from the total distributed earnings. The result is the amount the beneficiary must include in income. Report it on Schedule 1 (Form 1040), line 8z.

In 2014, a young student’s parents opened a savings account for them with a QTP maintained by their state government. Over the years, the parents contributed $18,000 to the account. The total balance in the account was $27,000 on the date the distribution was made. In the summer of 2023, the student enrolled in college and had $8,300 of qualified education expenses for the rest of the year. The college expenses were paid from the following sources.

Before the student can determine the taxable part of their QTP distribution, they must reduce their total qualified education expenses by any tax-free educational assistance.

The student’s Form 1099-Q shows that $950 of the QTP distribution is earnings. They figure the taxable part of the distributed earnings as follows.

An American opportunity or lifetime learning credit (education credit) can be claimed in the same year the beneficiary takes a tax-free distribution from a QTP, as long as the same expenses aren't used for both benefits. This means that after the beneficiary reduces qualified education expenses by tax-free educational assistance, the beneficiary must further reduce them by the expenses taken into account in determining the credit.

Assume the same facts as in Example 1 , except that the parents claimed an American opportunity credit of $2,500 (based on $4,000 expenses).

If a designated beneficiary receives distributions from both a QTP and a Coverdell ESA in the same year, and the total of these distributions is more than the beneficiary's AQEE, the expenses must be allocated between the distributions.

Assume the same facts as in Example 2 , except that instead of receiving a $5,300 distribution from their QTP, the student received $4,600 from that account and $700 from their Coverdell ESA. In this case, the student must allocate their $1,200 of AQEE between the two distributions.

The student then figures the taxable portion of their Coverdell ESA distribution based on qualified education expenses of $158, and the taxable portion of their QTP distribution based on the other $1,042.

If you are required to allocate your expenses between Coverdell ESA and QTP distributions, and you have adjusted qualified elementary and secondary education expenses, see the examples in chapter 6 under Coordination With Qualified Tuition Program (QTP) Distributions .

For tax years beginning after 2017 and before 2026, if you have a loss on your investment in a QTP account, you can’t claim the loss on your income tax return. You have a loss only when all amounts from that account have been distributed and the total distributions are less than your unrecovered basis. Your basis is the total amount of contributions to that QTP account.

This exception only applies to the extent the distribution isn't more than the scholarship, allowance, or payment.

Made on account of the attendance of the designated beneficiary at a U.S. military academy (such as the USNA at Annapolis). This exception applies only to the extent that the amount of the distribution doesn't exceed the costs of advanced education (as defined in section 2005(d)(3) of title 10 of the U.S. Code) attributable to such attendance.

Assets can be rolled over or transferred from one QTP to another or from a QTP to an ABLE account. In addition, the designated beneficiary can be changed without transferring accounts.

Any amount distributed from a QTP isn't taxable if it's rolled over to either:

Another QTP for the benefit of the same beneficiary or for the benefit of a member of the beneficiary's family (including the beneficiary's spouse), or

An ABLE account for the benefit of the same beneficiary or for the benefit of a member of the beneficiary’s family (including the beneficiary’s spouse). But this doesn’t apply to the extent the amount distributed when added to other amounts contributed to the ABLE account exceeds the annual contribution limit. For more information about ABLE accounts, see Pub. 907, Tax Highlights for Persons With Disabilities.

An amount is rolled over if it's paid to an ABLE account or another QTP within 60 days after the date of the distribution.

When you graduated from college in January last year, you had $5,000 left in your QTP. You wanted to give this money to your younger sibling, who was in junior high school. In order to avoid paying tax on the distribution of the amount remaining in your account, you contributed the same amount to your sibling's QTP within 60 days of the distribution.

There are no income tax consequences if the designated beneficiary of an account is changed to a member of the beneficiary's family. See Members of the beneficiary's family , earlier.

Assume the same situation as in the last example. Instead of closing your QTP and paying the distribution into your sibling's QTP, you could have instructed the trustee of your account to simply change the name of the beneficiary on the account to that of your sibling.

8. Education Exception to Additional Tax on Early IRA Distributions

Generally, if you take a distribution from your IRA before you reach age 59½, you must pay a 10% additional tax on the early distribution. This applies to any IRA you own, whether it is a traditional IRA (including a SEP-IRA), a Roth IRA, or a SIMPLE IRA. The additional tax on an early distribution from a SIMPLE IRA may be as high as 25%. See Pub. 560, Retirement Plans for Small Business, for information on SEP-IRAs, and Pub. 590-B for information about distributions from all other IRAs.

However, you can take distributions from your IRAs for qualified higher education expenses without having to pay the 10% additional tax. You may owe income tax on at least part of the amount distributed, but you may not have to pay the 10% additional tax.

Generally, if the taxable part of the distribution is less than or equal to the adjusted qualified education expenses (AQEE), none of the distribution is subject to the additional tax. If the taxable part of the distribution is more than the AQEE, only the excess is subject to the additional tax.

Who Is Eligible? Individual retirement arrangements (IRAs)Early distributions from IRAs

You can take a distribution from your IRA before you reach age 59½ and not have to pay the 10% additional tax if, for the year of the distribution, you pay qualified education expenses for:

Your or your spouse's child, foster child, or adopted child; or

Your or your spouse’s grandchild.

For purposes of the 10% additional tax, these expenses are tuition, fees, books, supplies, and equipment required for enrollment or attendance at an eligible educational institution. They also include expenses for special needs services incurred by or for special needs students in connection with their enrollment or attendance.

In addition, if the student is at least a half-time student, room and board are qualified education expenses.

The allowance for room and board, as determined by the eligible educational institution, that was included in the cost of attendance (for federal financial aid purposes) for a particular academic period and living arrangement of the student.

The actual amount charged if the student is residing in housing owned or operated by the eligible educational institution.

An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education. Virtually all accredited public, non-profit, and proprietary (privately owned profit-making) postsecondary institutions meet this definition.

A student is enrolled “at least half-time” if the student is enrolled for at least half the full-time academic workload for the course of study the student is pursuing as determined under the standards of the school where the student is enrolled.

To determine the amount of your distribution that isn't subject to the 10% additional tax, first figure your AQEE. You do this by reducing your total qualified education expenses by any tax-free educational assistance, which includes:

Expenses used to figure the tax-free portion of distributions from a Coverdell education savings account (ESA) (see Distributions in chapter 6 );

An inheritance given to either the student or the individual making the withdrawal; or

A withdrawal from personal savings (including savings from a qualified tuition program (QTP)).

If your IRA distribution is equal to or less than your AQEE, you aren't subject to the 10% additional tax.

In 2023, a teacher (age 32) took a year off from teaching to attend graduate school full time. They paid $5,800 of qualified education expenses from the following sources.

Before the teacher can determine if they must pay the 10% additional tax on their IRA distribution, they must reduce their total qualified education expenses.

Assume the same facts as in Example 1 , except that the teacher deducted some of the contributions to their IRA, so the taxable part of their early distribution is $1,000. This must be included in their income subject to income tax.

The taxable part of the teacher's IRA distribution ($1,000) is larger than their $800 AQEE. Therefore, they must pay the 10% additional tax on $200, the taxable part of their distribution ($1,000) that is more than their AQEE ($800). The teacher doesn't have to pay the 10% additional tax on the remaining $800 of their taxable distribution.

By January 31, 2024, the payer of your IRA distribution should send you Form 1099-R, Distributions From Pensions, Annuities, Retirement or Profit-Sharing Plans, IRAs, Insurance Contracts, etc. The information on this form will help you determine how much of your distribution is taxable for income tax purposes and how much is subject to the 10% additional tax.

If you received an early distribution from your IRA, you must report the taxable part of the distribution on Form 1040, 1040-SR, or 1040-NR, line 4b. Then, if you qualify for an exception for qualified higher education expenses, you must file Form 5329 to show how much, if any, of your early distribution is subject to the 10% additional tax. See the instructions for Form 5329, Part I, for help in completing the form and entering the results on Schedule 2 (Form 1040), line 8.

There are many other situations in which Form 5329 is required. If, during 2023, you had other distributions from IRAs or qualified retirement plans, or have made excess contributions to certain tax-favored accounts, see the instructions for Schedule 2 (Form 1040), line 8, to determine if you must file Form 5329.

9. Education Savings Bond Program

Modified adjusted gross income (MAGI) limits. For 2023, the amount of your education savings bond interest exclusion is gradually reduced (phased out) if your MAGI is between $91,850 and $106,850 ($137,800 and $167,800 if you file a joint return). You can't exclude any of the interest if your MAGI is $106,850 or more ($167,800 or more if you file a joint return).

Generally, you must pay tax on the interest earned on U.S. savings bonds. If you don't include the interest in income in the years it is earned, you must include it in your income in the year in which you cash in the bonds.

However, when you cash in certain savings bonds under an education savings bond program, you may be able to exclude the interest from income.

Who Can Cash in Bonds Tax Free?

You may be able to cash in qualified U.S. savings bonds without having to include in your income some or all of the interest earned on the bonds if you meet the following conditions.

You pay qualified education expenses for yourself, your spouse, or a dependent.

Your MAGI is less than $106,850 ($167,800 if married filing jointly).

Your filing status isn't married filing separately.

A qualified U.S. savings bond is a series EE bond issued after 1989 or a series I bond. The bond must be issued either in your name (as the sole owner) or in the name of both you and your spouse (as co-owners).

The owner must be at least 24 years old before the bond's issue date. The issue date is printed in the upper right corner of a paper bond and shown in TreasuryDirect for an electronic bond.

These include the following items you pay for either yourself, your spouse, or a dependent.

Tuition and fees required to enroll at or attend an eligible educational institution. Qualified education expenses don't include expenses for room and board or for courses involving sports, games, or hobbies that aren't part of a degree or certificate-granting program.

Contributions to a qualified tuition program (QTP) (see How Much Can You Contribute in chapter 7 ).

Contributions to a Coverdell education savings account (ESA) (see Contributions in chapter 6 ).

You must reduce your qualified education expenses by all of the following tax-free benefits.

Tax-free part of scholarships and fellowship grants (see Tax-Free Scholarships and Fellowship Grants in chapter 1 ).

Expenses used to figure the tax-free portion of distributions from a Coverdell ESA (see Qualified Education Expenses in chapter 6 ).

Expenses used to figure the tax-free portion of distributions from a QTP (see Qualified Education Expenses in chapter 7 ).

Any tax-free payments (other than gifts or inheritances) received as educational assistance, such as:

Veterans' educational assistance benefits (see Veterans' Benefits in chapter 1 );

Qualified tuition reductions (see Qualified Tuition Reduction in chapter 1 ); or

Employer-provided educational assistance (see chapter 10 ).

Any expenses used in figuring the American opportunity and lifetime learning credits. See What Expenses Qualify in chapter 2 (American opportunity credit) , and What Expenses Qualify in chapter 3 (lifetime learning credit) , for more information.

A person who qualifies as your dependent will be listed by name in the Dependents section of your Form 1040 or 1040-SR. See the Instructions for Form 1040.

For most taxpayers, MAGI is adjusted gross income (AGI) as figured on their federal income tax return without taking into account this interest exclusion. However, as discussed below, there may be other modifications.

Your MAGI is the AGI on line 11 of Form 1040 or 1040-SR figured without taking into account any savings bond interest exclusion and modified by adding back any:

Exclusion of income by bona fide residents of American Samoa,

Exclusion of income by bona fide residents of Puerto Rico,

Exclusion for adoption benefits received under an employer's adoption assistance program, and

Deduction for student loan interest.

Use the worksheet in the instructions for line 9 of Form 8815 to figure your MAGI. If you claim any of the exclusion or deduction items (1)–(6) listed above, add the amount of the exclusion or deduction to the amount on line 5 of the worksheet. Don't add in the deduction for (7) student loan interest, because line 4 of the worksheet already includes this amount. Enter the total on Form 8815, line 9, as your MAGI.

Figuring the Tax-Free Amount

If the total you receive when you cash in the bonds isn't more than the AQEE for the year, all of the interest on the bonds may be tax free. However, if the total you receive when you cash in the bonds is more than the adjusted expenses, only part of the interest may be tax free.

To determine the tax-free amount, multiply the interest part of the proceeds by a fraction. The numerator (top part) of the fraction is the AQEE you paid during the year. The denominator (bottom part) of the fraction is the total proceeds you received during the year.

In February 2023, a married couple cashed a qualified series EE U.S. savings bond. They received proceeds of $9,000, representing principal of $6,000 and interest of $3,000. In 2023, they paid $7,650 of their child's college tuition. They aren't claiming an American opportunity or lifetime learning credit for those expenses, and their child doesn't have any tax-free educational assistance. Their MAGI for 2023 was $90,000.

They can exclude $2,550 of interest in 2023. They must pay tax on the remaining $450 ($3,000 − $2,550) of interest.

The amount of your interest exclusion is gradually reduced (phased out) if your MAGI is between $91,850 and $106,850 (between $137,800 and $167,800 if your filing status is married filing jointly). You can’t exclude any of the interest if your MAGI is equal to or more than the upper limit.

The phaseout, if any, is figured for you when you fill out Form 8815.

Use Form 8815 to figure your education savings bond interest exclusion. Enter your exclusion on line 3 of Schedule B (Form 1040), Interest and Ordinary Dividends. Attach Form 8815 to your tax return.

10. Employer-Provided Educational Assistance

Educational assistance benefits. Employer-provided educational assistance benefits include payments made after March 27, 2020, and before January 1, 2026, for principal or interest on any qualified education loan you incurred for your education. See Educational assistance benefits .

If you receive educational assistance benefits from your employer under an educational assistance program, you can exclude up to $5,250 of those benefits each year. This means your employer shouldn’t include those benefits with your wages, tips, and other compensation shown in box 1 of your Form W-2. This also means that you don’t have to include the benefits on your income tax return.

To qualify as an educational assistance program, the plan must be written and must meet certain other requirements. Your employer can tell you whether there is a qualified program where you work.

Tax-free educational assistance benefits include payments for tuition, fees and similar expenses, books, supplies, and equipment. Education generally includes any form of instruction or training that improves or develops your capabilities. The payments don't have to be for work-related courses or courses that are part of a degree program.

Tax-free educational assistance benefits also include payments made after March 27, 2020, and before January 1, 2026, whether paid to the employee or to a lender, of principal or interest on any qualified education loan (defined later) incurred by the employee for education of the employee.

Educational assistance benefits don't include payments for the following items.

Meals, lodging, or transportation.

Tools or supplies (other than textbooks) that you can keep after completing the course of instruction.

Courses involving sports, games, or hobbies unless they:

Have a reasonable relationship to the business of your employer, or

Are required as part of a degree program.

A qualified education loan is generally the same as a qualified student loan. See Qualified Student Loan in chapter 4. However, as discussed earlier, the loan must be incurred by the employee for education of the employee.

If your employer pays more than $5,250 in educational assistance benefits for you during the year, you must generally pay tax on the amount over $5,250. Your employer should include in your wages (box 1 of Form W-2) the amount that you must include in income.

However, if the benefits over $5,250 also qualify as a working condition fringe benefit, your employer doesn't have to include them in your wages. A working condition fringe benefit is a benefit that, had you paid for it, would be allowable as a business expense deduction. For more information on working condition fringe benefits, see Working Condition Benefits in chapter 2 of Pub. 15-B, Employer's Tax Guide to Fringe Benefits.

11. Business Deduction for Work-Related Education

Standard mileage rate. Generally, if you claim a business deduction for work-related education and you drive your car to and from school, the amount you can deduct for miles driven from January 1, 2023, through December 31, 2023, is 65.5 cents a mile. For more information, see Transportation Expenses under What Expenses Can Be Deducted .

Miscellaneous itemized deductions. For tax years beginning after 2017 and before 2026, you no longer deduct work-related education expenses as a miscellaneous itemized deduction subject to a 2%-of-adjusted-gross-income floor.

This chapter discusses work-related education expenses you may be able to deduct as business expenses.

To claim such a deduction, you must:

File Schedule C (Form 1040), Profit or Loss From Business, or Schedule F (Form 1040), Profit or Loss From Farming, if you are self-employed;

File Form 2106, Employee Business Expenses, if you are an Armed Forces reservist, a qualified performing artist, a fee-based state or local government official, or an individual with a disability claiming impairment-related education expenses;

Itemize your deductions on Schedule A (Form 1040) or Schedule A (Form 1040-NR), if you are an individual with a disability claiming impairment-related education expenses; and

Have expenses for education that meet the requirements discussed under Qualifying Work-Related Education , later.

If you are self-employed, you deduct your expenses for qualifying work-related education directly from your self-employment income. This reduces the amount of your income subject to both income tax and self-employment tax.

If you are an Armed Forces reservist, qualified performing artist, or a fee-based state or local government official, you deduct your expenses for qualifying work-related education directly from your income as you figure your adjusted gross income.

If you are an individual with a disability and can itemize your deductions, you deduct your impairment-related education expenses as an itemized deduction. An itemized deduction reduces the amount of your income subject to tax.

Your work-related education expenses may also qualify you for other tax benefits, such as the American opportunity (see chapter 2 ) and lifetime learning (see chapter 3 ) credits. You may qualify for these other benefits even if you don't meet the requirements listed above.

Also, your work-related education expenses may qualify you to claim more than one tax benefit. Generally, you may claim any number of benefits as long as you use different expenses to figure each one.

Qualifying Work-Related Education

As discussed earlier, self-employed individuals, Armed Forces reservists, certain artists, and certain government officials can deduct the costs of qualifying work-related education as business expenses. Individuals with a disability can deduct impairment expenses related to this education as an itemized deduction. This is education that meets at least one of the following two tests.

The education is required by your employer or the law to keep your present salary, status, or job. The required education must serve a bona fide business purpose of your employer.

The education maintains or improves skills needed in your present work.

However, even if the education meets one or both of the above tests, it isn't qualifying work-related education if it:

Is needed to meet the minimum educational requirements of your present trade or business, or

Is part of a program of study that will qualify you for a new trade or business.

You can deduct the costs of qualifying work-related education as a business expense even if the education could lead to a degree.

Use Figure 11-1 as a quick check to see if your education qualifies.

Once you have met the minimum educational requirements for your job, your employer or the law may require you to get more education. This additional education is qualifying work-related education if all three of the following requirements are met.

It is required for you to keep your present salary, status, or job.

The requirement serves a bona fide business purpose of your employer.

The education isn't part of a program that will qualify you for a new trade or business.

When you get more education than your employer or the law requires, the additional education can be qualifying work-related education only if it maintains or improves skills required in your present work. See Education To Maintain or Improve Skills , later.

You are a teacher who has satisfied the minimum requirements for teaching. Your employer requires you to take an additional college course each year to keep your teaching job. If the courses won't qualify you for a new trade or business, they are qualifying work-related education even if you eventually receive a master's degree and an increase in salary because of this extra education.

Figure 11-1. Does Your Work-Related Education Qualify?

Figure 11-1

Figure 11–1. Does Your Work-Related Education Qualify?

Summary: This flowchart is used to determine if expenses incurred for work-related education qualify for deduction.

This is the beginning of the flowchart.

Is the education required by your employer or the law to keep your present salary, status, or job?

Does the requirement serve a bona fide business requirement of your employer?

Does the education maintain or improve skills needed in your present work?

Is the education needed to meet the minimum educational requirements of your present trade or business?

Is the education part of a program of study that will qualify you for a new trade or business?

Your education isn't qualifying work-related education.

Your education is qualifying work-related education.

Education To Maintain or Improve Skills

If your education isn't required by your employer or the law, it can be qualifying work-related education only if it maintains or improves skills needed in your present work. This could include refresher courses, courses on current developments, and academic or vocational courses.

You repair televisions, radios, and stereo systems for XYZ Store. To keep up with the latest changes, you take special courses in radio and stereo service. These courses maintain and improve skills required in your work.

Education to maintain or improve skills needed in your present work isn't qualifying education if it will also qualify you for a new trade or business.

If you stop working for a year or less in order to get education to maintain or improve skills needed in your present work and then return to the same general type of work, your absence is considered temporary. Education that you get during a temporary absence is qualifying work-related education if it maintains or improves skills needed in your present work.

You quit your biology research job to become a full-time biology graduate student for 1 year. If you return to work in biology research after completing the courses, the education is related to your present work even if you don't go back to work with the same employer.

If you stop work for more than a year, your absence from your job is considered indefinite. Education during an indefinite absence, even if it maintains or improves skills needed in the work from which you are absent, is considered to qualify you for a new trade or business. Therefore, it isn't qualifying work-related education.

Education To Meet Minimum Requirements

Education you need to meet the minimum educational requirements for your present trade or business isn't qualifying work-related education. The minimum educational requirements are determined by:

Laws and regulations;

Standards of your profession, trade, or business; and

Your employer.

Once you have met the minimum educational requirements that were in effect when you were hired, you don't have to meet any new minimum educational requirements. This means that if the minimum requirements change after you were hired, any education you need to meet the new requirements can be qualifying education.

You are a full-time engineering student. Although you haven't received your degree or certification, you work part time as an engineer for a firm that will employ you as a full-time engineer after you finish college. Although your college engineering courses improve your skills in your present job, they are also needed to meet the minimum job requirements for a full-time engineer. The education isn't qualifying work-related education.

You are an accountant and you have met the minimum educational requirements of your employer. Your employer later changes the minimum educational requirements and requires you to take college courses to keep your job. These additional courses can be qualifying work-related education because you have already satisfied the minimum requirements that were in effect when you were hired.

Requirements for Teachers

States or school districts usually set the minimum educational requirements for teachers. The requirement is the college degree or the minimum number of college hours usually required of a person hired for that position.

If there are no requirements, you will have met the minimum educational requirements when you become a faculty member. The determination of whether you are a faculty member of an educational institution must be made on the basis of the particular practices of the institution. You will generally be considered a faculty member when one or more of the following occurs.

You have tenure.

Your years of service count toward obtaining tenure.

You have a vote in faculty decisions.

Your school makes contributions for you to a retirement plan other than social security or a similar program.

The law in your state requires beginning secondary school teachers to have a bachelor's degree, including 10 professional education courses. In addition, to keep the job, a teacher must complete a fifth year of training within 10 years from the date of hire. If the employing school certifies to the state Department of Education that qualified teachers can't be found, the school can hire persons with only 3 years of college. However, to keep their jobs, these teachers must get a bachelor's degree and the required professional education courses within 3 years.

Under these facts, the bachelor's degree, whether or not it includes the 10 professional education courses, is considered the minimum educational requirement for qualification as a teacher in your state.

If you have all the required education except the fifth year, you have met the minimum educational requirements. The fifth year of training is qualifying work-related education unless it is part of a program of study that will qualify you for a new trade or business.

Assume the same facts as in Example 1 , except that you have a bachelor's degree and only six professional education courses. The additional four education courses can be qualifying work-related education. Although you don't have all the required courses, you have already met the minimum educational requirements.

Assume the same facts as in Example 1 , except that you are hired with only 3 years of college. The courses you take that lead to a bachelor's degree (including those in education) aren't qualifying work-related education. They are needed to meet the minimum educational requirements for employment as a teacher.

You have a bachelor's degree and you work as a temporary instructor at a university. At the same time, you take graduate courses toward an advanced degree. The rules of the university state that you can become a faculty member only if you get a graduate degree. Also, you can keep your job as an instructor only as long as you show satisfactory progress toward getting this degree. You haven't met the minimum educational requirements to qualify you as a faculty member. The graduate courses aren't qualifying work-related education.

Once you have met the minimum educational requirements for teachers for your state, you are considered to have met the minimum educational requirements in all states. This is true even if you must get additional education to be certified in another state. Any additional education you need is qualifying work-related education. You have already met the minimum requirements for teaching. Teaching in another state isn't a new trade or business.

You hold a permanent teaching certificate in State A and are employed as a teacher in that state for several years. You move to State B and are promptly hired as a teacher. You are required, however, to complete certain prescribed courses to get a permanent teaching certificate in State B. These additional courses are qualifying work-related education because the teaching position in State B involves the same general kind of work for which you were qualified in State A.

Education That Qualifies You for a New Trade or Business

Education that is part of a program of study that will qualify you for a new trade or business isn't qualifying work-related education. This is true even if you don't plan to enter that trade or business.

If you are an employee, a change of duties that involves the same general kind of work isn't a new trade or business.

You are an accountant. Your employer requires you to get a law degree at your own expense. You register at a law school for the regular curriculum that leads to a law degree. Even if you don't intend to become a lawyer, the education isn't qualifying because the law degree will qualify you for a new trade or business.

You are a general practitioner of medicine. You take a 2-week course to review developments in several specialized fields of medicine. The course doesn't qualify you for a new profession. It is qualifying work-related education because it maintains or improves skills required in your present profession.

While working in the private practice of psychiatry, you enter a program to study and train at an accredited psychoanalytic institute. The program will lead to qualifying you to practice psychoanalysis. The psychoanalytic training doesn't qualify you for a new profession. It is qualifying work-related education because it maintains or improves skills required in your present profession.

Review courses to prepare for the bar examination or the certified public accountant (CPA) examination aren't qualifying work-related education. They are part of a program of study that can qualify you for a new profession.

All teaching and related duties are considered the same general kind of work. A change in duties in any of the following ways isn't considered a change to a new business.

Elementary school teacher to secondary school teacher.

Teacher of one subject, such as biology, to teacher of another subject, such as art.

Classroom teacher to guidance counselor.

Classroom teacher to school administrator.

What Expenses Can Be Deducted?

If your education meets the requirements described earlier under Qualifying Work-Related Education , you may be able to deduct your education expenses as business expenses. If you aren't self-employed, you can deduct business expenses only if you are an Armed Forces reservist, qualified performing artist, fee-based state or local government official, or, for impairment-related expenses, an individual with a disability.

You can't deduct expenses related to tax-exempt and excluded income.

The following education expenses can be deducted.

Tuition, books, supplies, lab fees, and similar items.

Certain transportation and travel costs.

Other education expenses, such as costs of research and typing when writing a paper as part of an educational program.

You can't deduct personal or capital expenses. For example, you can't deduct the dollar value of vacation time or annual leave you take to attend classes. This amount is a personal expense.

If you don't claim reimbursement that you are entitled to receive from your employer, you can't deduct the expenses that apply to that unclaimed reimbursement.

Your employer agrees to pay your education expenses if you file a voucher showing your expenses. You don't file a voucher and you don't get reimbursed. Because you didn't file a voucher, you can't deduct the expenses on your tax return.

Transportation Expenses

If your education qualifies, you can deduct local transportation costs of going directly from work to school. If you are regularly employed and go to school on a temporary basis, you can also deduct the costs of returning from school to home.

You go to school on a temporary basis if either of the following situations applies to you.

Your attendance at school is realistically expected to last 1 year or less and does indeed last for 1 year or less.

Initially, your attendance at school is realistically expected to last 1 year or less, but at a later date your attendance is reasonably expected to last more than 1 year. Your attendance is temporary up to the date you determine it will last more than 1 year.

You don't go to school on a temporary basis if either of the following situations applies to you.

Your attendance at school is realistically expected to last more than 1 year. It doesn't matter how long you actually attend.

Initially, your attendance at school is realistically expected to last 1 year or less, but at a later date your attendance is reasonably expected to last more than 1 year. Your attendance isn't temporary after the date you determine it will last more than 1 year.

Deductible Transportation Expenses

If you are regularly employed and go directly from home to school on a temporary basis, you can deduct the roundtrip costs of transportation between your home and school. This is true regardless of the location of the school, the distance traveled, or whether you attend school on nonwork days.

Transportation expenses include the actual costs of bus, subway, cab, or other fares, as well as the costs of using your car. Transportation expenses don't include amounts spent for travel, meals, or lodging while you are away from home overnight.

You regularly work in a nearby town, and go directly from work to home. You also attend school every work night for 3 months to take a course that improves your job skills. Since you are attending school on a temporary basis, you can deduct your daily roundtrip transportation expenses in going between home and school. This is true regardless of the distance traveled.

Assume the same facts as in Example 1 , except that on certain nights you go directly from work to school and then home. You can deduct your transportation expenses from your regular work site to school and then home.

Assume the same facts as in Example 1 , except that you attend the school for 9 months on Saturdays, nonwork days. Since you are attending school on a temporary basis, you can deduct your roundtrip transportation expenses in going between home and school.

Assume the same facts as in Example 1 , except that you attend classes twice a week for 15 months. Since your attendance in school isn't considered temporary, you can't deduct your transportation expenses in going between home and school. If you go directly from work to school, you can deduct the one-way transportation expenses of going from work to school. If you go from work to home to school and return home, your transportation expenses can't be more than if you had gone directly from work to school.

If you use your car (whether you own or lease it) for transportation to school, you can deduct your actual expenses or use the standard mileage rate to figure the amount you can deduct. The standard mileage rate for miles driven from January 1, 2023, through December 31, 2023, is 65.5 cents a mile. Whichever method you use, you can also deduct parking fees and tolls. See Pub. 463, chapter 4, for information on deducting your actual expenses of using a car.

Travel Expenses

You can deduct expenses for travel, meals (see 50% limit on meals , later), and lodging if you travel overnight mainly to obtain qualifying work-related education.

Travel expenses for qualifying work-related education are treated the same as travel expenses for other employee business purposes. For more information, see chapter 1 of Pub. 463.

If your travel away from home is mainly personal, you can't deduct all of your expenses for travel, meals, and lodging. You can deduct only your expenses for lodging and meals (see 50% limit on meals , later) during the time you attend the qualified educational activities.

Whether a trip's purpose is mainly personal or educational depends upon the facts and circumstances. An important factor is the comparison of time spent on personal activities with time spent on educational activities. If you spend more time on personal activities, the trip is considered mainly educational only if you can show a substantial nonpersonal reason for traveling to a particular location.

You work in Newark, New Jersey. You traveled to Chicago to take a deductible 1-week course at the request of your employer. Your main reason for going to Chicago was to take the course.

While there, you took a sightseeing trip, entertained some friends, and took a side trip to Pleasantville for a day.

Since the trip was mainly for business, you can deduct your roundtrip airfare to Chicago. You can't deduct your transportation expenses of going to Pleasantville. You can deduct only the meals (see 50% limit on meals , later) and lodging connected with your educational activities.

You work in Boston. You went to a university in Michigan to take a course for work. The course is qualifying work-related education.

You took one course, which is one-fourth of a full course load of study. You spent the rest of the time on personal activities. Your reasons for taking the course in Michigan were all personal.

Your trip is mainly personal because three-fourths of your time is considered personal time. You can't deduct the cost of your roundtrip train ticket to Michigan. You can deduct one-fourth of the meals (see 50% limit on meals , later) and lodging costs for the time you attended the university.

You work in Nashville and recently traveled to California to take a 2-week seminar. The seminar is qualifying work-related education.

While there, you spent an extra 8 weeks on personal activities. The facts, including the extra 8-week stay, show that your main purpose was to take a vacation.

You can't deduct your roundtrip airfare or your meals and lodging for the 8 weeks. You can deduct only your expenses for meals (see 50% limit on meals , later) and lodging for the 2 weeks you attended the seminar.

Certain cruises and conventions offer seminars or courses as part of their itinerary. Even if the seminars or courses are work related, your deduction for travel may be limited. This applies to:

Travel by ocean liner, cruise ship, or other form of luxury water transportation; and

Conventions outside the North American area.

For a discussion of the limits on travel expense deductions that apply to cruises and conventions, see Luxury Water Travel and Conventions in chapter 1 of Pub. 463.

You can deduct only 50% of the cost of your meals while traveling away from home to obtain qualifying work-related education. If you were reimbursed for the meals, see How To Treat Reimbursements , later.

Qualified performing artists and fee-based state or local government officials must use Form 2106 to apply the 50% limit.

You can't deduct the cost of travel as a form of education even if it is directly related to your duties in your work or business.

You are a French language teacher. While on sabbatical leave granted for travel, you traveled through France to improve your knowledge of the French language. You chose your itinerary and most of your activities to improve your French language skills. You can't deduct your travel expenses as education expenses. This is true even if you spent most of your time learning French by visiting French schools and families, attending movies or plays, and engaging in similar activities.

You can't do the following.

Deduct work-related education expenses as business expenses if you benefit from these expenses under any other provision of the law.

Deduct work-related education expenses paid with tax-free scholarship, grant, or employer-provided educational assistance.

Adjustments to Qualifying Work-Related Education Expenses

If you pay qualifying work-related education expenses with certain tax-free funds, you can't claim a deduction for those amounts. You must reduce the qualifying expenses by the amount of such expenses allocable to the tax-free educational assistance.

This includes:

Don't reduce the qualifying work-related education expenses by amounts paid with funds the student receives as:

Also, don't reduce the qualifying work-related education expenses by any scholarship or fellowship grant reported as income on the student's return or any scholarship that, by its terms, can't be applied to qualifying work-related education expenses.

How To Treat Reimbursements

How you treat reimbursements depends on the arrangement you have with your employer.

There are two basic types of reimbursement arrangements—accountable plans and nonaccountable plans. You can tell the type of plan you are reimbursed under by the way the reimbursement is reported on your Form W-2.

The following rules about reimbursement arrangements also apply to expense allowances received from your employer.

Accountable Plans

To be an accountable plan, your employer's reimbursement arrangement must require you to meet all three of the following rules.

Your expenses must have a business connection. This means your expenses must be allowed under the rules for qualifying work-related education explained earlier.

You must adequately account to your employer for your expenses within a reasonable period of time.

You must return any reimbursement or allowance in excess of the expenses accounted for within a reasonable period of time.

If you are reimbursed under an accountable plan, your employer shouldn't include any reimbursement of income on your Form W-2, box 1.

Even though you are reimbursed under an accountable plan, some of your expenses may not meet all three rules for accountable plans. Those expenses that fail to meet the three rules are treated as having been reimbursed under a Nonaccountable Plan (discussed later).

Under an accountable plan, if your expenses equal your reimbursement, you don't complete Form 2106. Because your expenses and reimbursements are equal, you don't have unreimbursed work-related education expenses.

If your expenses are more than your reimbursement, you generally cannot deduct your excess expenses. See Deducting Business Expenses , later.

Because your excess meal expenses are subject to the 50% limit, you must figure them separately from your other expenses. If your employer paid you a single amount to cover both meals and other expenses, you must allocate the reimbursement so that you can figure your excess meal expenses separately. Make the allocation as follows.

Divide your meal expenses by your total expenses.

Multiply your total reimbursement by the result from (1). This is the allocated reimbursement for your meal expenses.

Subtract the amount figured in (2) from your total reimbursement. The difference is the allocated reimbursement for your other expenses of qualifying work-related education.

You are a qualified performing artist and one of your employers paid you an expense allowance of $2,000 under an accountable plan. The allowance was to cover all of your expenses of traveling away from home to take a 2-week training course for work. There was no indication of how much of the reimbursement was for each type of expense. Your actual expenses equal $2,500 ($425 for meals + $700 lodging + $150 transportation expenses + $1,225 for books and tuition).

Using the steps listed above, allocate the reimbursement between the $425 meal expenses and the $2,075 other expenses.

Nonaccountable Plans

Your employer will combine the amount of any reimbursement or other expense allowance paid to you under a nonaccountable plan with your wages, salary, or other pay and report the total on your Form W-2, box 1.

You generally cannot deduct your expenses regardless of whether they are more than, less than, or equal to your reimbursement. See Deducting Business Expenses , later.

Reimbursements you received for nondeductible expenses are treated as paid under a nonaccountable plan. You must include them in your income. For example, you must include in your income reimbursements your employer gave you for expenses of education that:

You need to meet the minimum educational requirements for your job, or

Is part of a program of study that can qualify you for a new trade or business.

For more information on accountable and nonaccountable plans, see chapter 6 of Pub. 463.

Deducting Business Expenses

Self-employed persons and employees report their business expenses differently.

The following information explains what forms you must use to deduct the cost of your qualifying work-related education as a business expense.

If you are self-employed, you must report the cost of your qualifying work-related education on the appropriate form used to report your business income and expenses (generally, Schedule C (Form 1040), or Schedule F (Form 1040)). If your education expenses include expenses for a car or truck, travel, or meals, report those expenses the same way you report other business expenses for those items. See the instructions for the form you file for information on how to complete it.

If you are an Armed Forces reservist, a qualified performing artist, or a state (or local) government official who is paid in whole or in part on a fee basis, you can deduct the cost of your qualifying work-related education as an adjustment to gross income.

Include the cost of your qualifying work-related education with any other employee business expenses on Schedule 1 (Form 1040), line 12. You must complete Form 2106 to figure your deduction.

For more information on qualified performing artists, see chapter 6 of Pub. 463.

If you are an individual with a disability and have impairment-related work expenses that are necessary for you to be able to get qualifying work-related education, you can deduct these expenses on Schedule A (Form 1040), line 16, or Schedule A (Form 1040-NR), line 7. To deduct these expenses, you must complete Form 2106.

For more information on impairment-related work expenses, see chapter 6 of Pub. 463.

Recordkeeping

If you are an employee who is reimbursed for expenses and you give your records and documentation to your employer, you don't have to keep duplicate copies of this information. However, you should keep your records for a 3-year period if:

You claim deductions for expenses that are more than your reimbursement,

Your employer doesn't use adequate accounting procedures to verify expense accounts,

You are related to your employer, or

Your expenses are reimbursed under a nonaccountable plan.

If any of the above cases apply to you, you must be able to prove that your expenses are deductible. You should keep adequate records or have sufficient evidence that will support your expenses. Estimates or approximations don't qualify as proof of an expense. Some examples of what can be used to help prove your expenses are the following.

Documents, such as transcripts, course descriptions, catalogs, etc., showing periods of enrollment in educational institutions, principal subjects studied, and descriptions of educational activity.

Canceled checks and receipts to verify amounts you spent for:

Tuition and books,

Meals and lodging while away from home overnight for educational purposes,

Travel and transportation, and

Other education expenses.

Statements from your employer explaining whether the education was necessary for you to keep your job, salary, or status; how the education helped maintain or improve skills needed in your job; how much reimbursement you received; and, if you are a teacher, the type of certificate and subjects taught.

Complete information about any scholarship or fellowship grants, including amounts you received during the year.

12. How To Get Tax Help

If you have questions about a tax issue; need help preparing your tax return; or want to download free publications, forms, or instructions, go to IRS.gov to find resources that can help you right away.

After receiving all your wage and earnings statements (Forms W-2, W-2G, 1099-R, 1099-MISC, 1099-NEC, etc.); unemployment compensation statements (by mail or in a digital format) or other government payment statements (Form 1099-G); and interest, dividend, and retirement statements from banks and investment firms (Forms 1099), you have several options to choose from to prepare and file your tax return. You can prepare the tax return yourself, see if you qualify for free tax preparation, or hire a tax professional to prepare your return.

Your options for preparing and filing your return online or in your local community, if you qualify, include the following.

Free File. This program lets you prepare and file your federal individual income tax return for free using software or Free File Fillable Forms. However, state tax preparation may not be available through Free File. Go to IRS.gov/FreeFile to see if you qualify for free online federal tax preparation, e-filing, and direct deposit or payment options.

VITA. The Volunteer Income Tax Assistance (VITA) program offers free tax help to people with low-to-moderate incomes, persons with disabilities, and limited-English-speaking taxpayers who need help preparing their own tax returns. Go to IRS.gov/VITA , download the free IRS2Go app, or call 800-906-9887 for information on free tax return preparation.

TCE. The Tax Counseling for the Elderly (TCE) program offers free tax help for all taxpayers, particularly those who are 60 years of age and older. TCE volunteers specialize in answering questions about pensions and retirement-related issues unique to seniors. Go to IRS.gov/TCE or download the free IRS2Go app for information on free tax return preparation.

MilTax. Members of the U.S. Armed Forces and qualified veterans may use MilTax, a free tax service offered by the Department of Defense through Military OneSource. For more information, go to MilitaryOneSource ( MilitaryOneSource.mil/MilTax ).

Also, the IRS offers Free Fillable Forms, which can be completed online and then e-filed regardless of income.

Go to IRS.gov/Tools for the following.

The Earned Income Tax Credit Assistant ( IRS.gov/EITCAssistant ) determines if you’re eligible for the earned income credit (EIC).

The Online EIN Application ( IRS.gov/EIN ) helps you get an employer identification number (EIN) at no cost.

The Tax Withholding Estimator ( IRS.gov/W4App ) makes it easier for you to estimate the federal income tax you want your employer to withhold from your paycheck. This is tax withholding. See how your withholding affects your refund, take-home pay, or tax due.

The First-Time Homebuyer Credit Account Look-up ( IRS.gov/HomeBuyer ) tool provides information on your repayments and account balance.

The Sales Tax Deduction Calculator ( IRS.gov/SalesTax ) figures the amount you can claim if you itemize deductions on Schedule A (Form 1040).

IRS.gov/Help : A variety of tools to help you get answers to some of the most common tax questions.

IRS.gov/ITA : The Interactive Tax Assistant, a tool that will ask you questions and, based on your input, provide answers on a number of tax topics.

IRS.gov/Forms : Find forms, instructions, and publications. You will find details on the most recent tax changes and interactive links to help you find answers to your questions.

You may also be able to access tax information in your e-filing software.

There are various types of tax return preparers, including enrolled agents, certified public accountants (CPAs), accountants, and many others who don’t have professional credentials. If you choose to have someone prepare your tax return, choose that preparer wisely. A paid tax preparer is:

Primarily responsible for the overall substantive accuracy of your return,

Required to sign the return, and

Required to include their preparer tax identification number (PTIN).

The Social Security Administration (SSA) offers online service at SSA.gov/employer for fast, free, and secure W-2 filing options to CPAs, accountants, enrolled agents, and individuals who process Form W-2, Wage and Tax Statement, and Form W-2c, Corrected Wage and Tax Statement.

Go to IRS.gov/SocialMedia to see the various social media tools the IRS uses to share the latest information on tax changes, scam alerts, initiatives, products, and services. At the IRS, privacy and security are our highest priority. We use these tools to share public information with you. Don’t post your social security number (SSN) or other confidential information on social media sites. Always protect your identity when using any social networking site.

The following IRS YouTube channels provide short, informative videos on various tax-related topics in English, Spanish, and ASL.

Youtube.com/irsvideos .

Youtube.com/irsvideosmultilingua .

Youtube.com/irsvideosASL .

The IRS Video portal ( IRSVideos.gov ) contains video and audio presentations for individuals, small businesses, and tax professionals.

You can find information on IRS.gov/MyLanguage if English isn’t your native language.

The IRS is committed to serving taxpayers with limited-English proficiency (LEP) by offering OPI services. The OPI Service is a federally funded program and is available at Taxpayer Assistance Centers (TACs), most IRS offices, and every VITA/TCE tax return site. The OPI Service is accessible in more than 350 languages.

Taxpayers who need information about accessibility services can call 833-690-0598. The Accessibility Helpline can answer questions related to current and future accessibility products and services available in alternative media formats (for example, braille, large print, audio, etc.). The Accessibility Helpline does not have access to your IRS account. For help with tax law, refunds, or account-related issues, go to IRS.gov/LetUsHelp .

Form 9000, Alternative Media Preference, or Form 9000(SP) allows you to elect to receive certain types of written correspondence in the following formats.

Standard Print.

Large Print.

Audio (MP3).

Plain Text File (TXT).

Braille Ready File (BRF).

Go to IRS.gov/DisasterRelief to review the available disaster tax relief.

Go to IRS.gov/Forms to view, download, or print all the forms, instructions, and publications you may need. Or, you can go to IRS.gov/OrderForms to place an order.

Download and view most tax publications and instructions (including the Instructions for Form 1040) on mobile devices as eBooks at IRS.gov/eBooks .

IRS eBooks have been tested using Apple's iBooks for iPad. Our eBooks haven’t been tested on other dedicated eBook readers, and eBook functionality may not operate as intended.

Go to IRS.gov/Account to securely access information about your federal tax account.

View the amount you owe and a breakdown by tax year.

See payment plan details or apply for a new payment plan.

Make a payment or view 5 years of payment history and any pending or scheduled payments.

Access your tax records, including key data from your most recent tax return, and transcripts.

View digital copies of select notices from the IRS.

Approve or reject authorization requests from tax professionals.

View your address on file or manage your communication preferences.

With an online account, you can access a variety of information to help you during the filing season. You can get a transcript, review your most recently filed tax return, and get your adjusted gross income. Create or access your online account at IRS.gov/Account .

This tool lets your tax professional submit an authorization request to access your individual taxpayer IRS online account. For more information, go to IRS.gov/TaxProAccount .

The safest and easiest way to receive a tax refund is to e-file and choose direct deposit, which securely and electronically transfers your refund directly into your financial account. Direct deposit also avoids the possibility that your check could be lost, stolen, destroyed, or returned undeliverable to the IRS. Eight in 10 taxpayers use direct deposit to receive their refunds. If you don’t have a bank account, go to IRS.gov/DirectDeposit for more information on where to find a bank or credit union that can open an account online.

Tax-related identity theft happens when someone steals your personal information to commit tax fraud. Your taxes can be affected if your SSN is used to file a fraudulent return or to claim a refund or credit.

The IRS doesn’t initiate contact with taxpayers by email, text messages (including shortened links), telephone calls, or social media channels to request or verify personal or financial information. This includes requests for personal identification numbers (PINs), passwords, or similar information for credit cards, banks, or other financial accounts.

Go to IRS.gov/IdentityTheft , the IRS Identity Theft Central webpage, for information on identity theft and data security protection for taxpayers, tax professionals, and businesses. If your SSN has been lost or stolen or you suspect you’re a victim of tax-related identity theft, you can learn what steps you should take.

Get an Identity Protection PIN (IP PIN). IP PINs are six-digit numbers assigned to taxpayers to help prevent the misuse of their SSNs on fraudulent federal income tax returns. When you have an IP PIN, it prevents someone else from filing a tax return with your SSN. To learn more, go to IRS.gov/IPPIN .

Go to IRS.gov/Refunds .

Download the official IRS2Go app to your mobile device to check your refund status.

Call the automated refund hotline at 800-829-1954.

Payments of U.S. tax must be remitted to the IRS in U.S. dollars. Digital assets are not accepted. Go to IRS.gov/Payments for information on how to make a payment using any of the following options.

IRS Direct Pay : Pay your individual tax bill or estimated tax payment directly from your checking or savings account at no cost to you.

Debit Card, Credit Card, or Digital Wallet : Choose an approved payment processor to pay online or by phone.

Electronic Funds Withdrawal : Schedule a payment when filing your federal taxes using tax return preparation software or through a tax professional.

Electronic Federal Tax Payment System : Best option for businesses. Enrollment is required.

Check or Money Order : Mail your payment to the address listed on the notice or instructions.

Cash : You may be able to pay your taxes with cash at a participating retail store.

Same-Day Wire : You may be able to do same-day wire from your financial institution. Contact your financial institution for availability, cost, and time frames.

The IRS uses the latest encryption technology to ensure that the electronic payments you make online, by phone, or from a mobile device using the IRS2Go app are safe and secure. Paying electronically is quick, easy, and faster than mailing in a check or money order.

Go to IRS.gov/Payments for more information about your options.

Apply for an online payment agreement ( IRS.gov/OPA ) to meet your tax obligation in monthly installments if you can’t pay your taxes in full today. Once you complete the online process, you will receive immediate notification of whether your agreement has been approved.

Use the Offer in Compromise Pre-Qualifier to see if you can settle your tax debt for less than the full amount you owe. For more information on the Offer in Compromise program, go to IRS.gov/OIC .

Go to IRS.gov/Form1040X for information and updates.

Go to IRS.gov/WMAR to track the status of Form 1040-X amended returns.

Go to IRS.gov/Notices to find additional information about responding to an IRS notice or letter.

You can now upload responses to all notices and letters using the Document Upload Tool. For notices that require additional action, taxpayers will be redirected appropriately on IRS.gov to take further action. To learn more about the tool, go to IRS.gov/Upload .

You can use Schedule LEP (Form 1040), Request for Change in Language Preference, to state a preference to receive notices, letters, or other written communications from the IRS in an alternative language. You may not immediately receive written communications in the requested language. The IRS’s commitment to LEP taxpayers is part of a multi-year timeline that began providing translations in 2023. You will continue to receive communications, including notices and letters, in English until they are translated to your preferred language.

Keep in mind, many questions can be answered on IRS.gov without visiting a TAC. Go to IRS.gov/LetUsHelp for the topics people ask about most. If you still need help, TACs provide tax help when a tax issue can’t be handled online or by phone. All TACs now provide service by appointment, so you’ll know in advance that you can get the service you need without long wait times. Before you visit, go to IRS.gov/TACLocator to find the nearest TAC and to check hours, available services, and appointment options. Or, on the IRS2Go app, under the Stay Connected tab, choose the Contact Us option and click on “Local Offices.”

The Taxpayer Advocate Service (TAS) Is Here To Help You

What is tas.

TAS is an independent organization within the IRS that helps taxpayers and protects taxpayer rights. TAS strives to ensure that every taxpayer is treated fairly and that you know and understand your rights under the Taxpayer Bill of Rights .

The Taxpayer Bill of Rights describes 10 basic rights that all taxpayers have when dealing with the IRS. Go to TaxpayerAdvocate.IRS.gov to help you understand what these rights mean to you and how they apply. These are your rights. Know them. Use them.

TAS can help you resolve problems that you can’t resolve with the IRS. And their service is free. If you qualify for their assistance, you will be assigned to one advocate who will work with you throughout the process and will do everything possible to resolve your issue. TAS can help you if:

Your problem is causing financial difficulty for you, your family, or your business;

You face (or your business is facing) an immediate threat of adverse action; or

You’ve tried repeatedly to contact the IRS but no one has responded, or the IRS hasn’t responded by the date promised.

TAS has offices in every state, the District of Columbia, and Puerto Rico . To find your local advocate’s number:

Go to TaxpayerAdvocate.IRS.gov/Contact-Us ;

Download Pub. 1546, The Taxpayer Advocate Service Is Your Voice at the IRS, available at IRS.gov/pub/irs-pdf/p1546.pdf ;

Call the IRS toll free at 800-TAX-FORM (800-829-3676) to order a copy of Pub. 1546;

Check your local directory; or

Call TAS toll free at 877-777-4778.

TAS works to resolve large-scale problems that affect many taxpayers. If you know of one of these broad issues, report it to TAS at IRS.gov/SAMS . Be sure to not include any personal taxpayer information.

LITCs are independent from the IRS and TAS. LITCs represent individuals whose income is below a certain level and who need to resolve tax problems with the IRS. LITCs can represent taxpayers in audits, appeals, and tax collection disputes before the IRS and in court. In addition, LITCs can provide information about taxpayer rights and responsibilities in different languages for individuals who speak English as a second language. Services are offered for free or a small fee. For more information or to find an LITC near you, go to the LITC page at TaxpayerAdvocate.IRS.gov/LITC or see IRS Pub. 4134, Low Income Taxpayer Clinic List , at IRS.gov/pub/irs-pdf/p4134.pdf .

Publication 970 - Additional Material

The following appendix is provided to help you claim the education benefits that will give you the lowest tax. It consists of a chart summarizing some of the major differences between the education tax benefits discussed in this publication. It is intended only as a guide. Look in this publication for more complete information.

Highlights of Education Tax Benefits for Tax Year 2023

The education benefits included in this publication were enacted over many years, leading to a number of common terms being defined differently from one benefit to the next. For example, an eligible educational institution means one thing when determining if earnings from a Coverdell ESA aren't taxable and something else when determining if a scholarship or fellowship grant isn't taxable.

For each term listed below that has more than one definition, the definition for each education benefit is listed.

A semester, trimester, quarter, or other period of study (such as a summer school session) as reasonably determined by an educational institution. If an educational institution uses credit hours or clock hours and doesn't have academic terms, each payment period can be treated as an academic period.

Qualified education expenses (defined later) reduced by any tax-free educational assistance, such as a tax-free scholarship or employer-provided educational assistance. They must also be reduced by any qualified education expenses deducted elsewhere on your return, used to determine an education credit or other benefit, or used to determine a tax-free distribution. For information on a specific benefit, see the appropriate chapter in this publication.

A student who meets either of the following requirements.

Attends a primary or secondary school or pursues a degree at a college or university.

Attends an accredited educational institution that is authorized to provide:

A program that is acceptable for full credit toward a bachelor's or higher degree, or

A program of training to prepare students for gainful employment in a recognized occupation.

The individual named in the document creating the account/plan who is to receive the benefit of the funds in the account/plan.

American opportunity credit. Any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education. It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions.

Coverdell education savings account (ESA). Any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education. It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. Also included is any public, private, or religious school that provides elementary or secondary education (kindergarten through grade 12), as determined under state law.

Education savings bond program. Same as American opportunity credit in this category.

IRA, early distributions from. Same as American opportunity credit in this category.

Lifetime learning credit. Same as American opportunity credit in this category.

Qualified tuition program (QTP). Generally, same as Coverdell education savings account (ESA) in this category.

Scholarships and fellowship grants. An institution that maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it carries on its educational activities.

Student loan, cancellation of. Same as Scholarships and fellowship grants in this category.

Student loan interest deduction. Any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education. It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. Also included is an institution that conducts an internship or residency program leading to a degree or certificate from an institution of higher education, a hospital, or a health care facility that offers postgraduate training.

American opportunity credit. A student who meets all of the following requirements for the tax year for which the credit is being determined.

Didn't have expenses that were used to figure an American opportunity credit in any 4 earlier tax years.

Hadn't completed the first 4 years of postsecondary education (generally, the freshman through senior years) in an earlier tax year.

For at least one academic period beginning in the tax year, was enrolled at least half-time in a program leading to a degree, certificate, or other recognized educational credential at an eligible educational institution.

Was free of any federal or state felony conviction for possessing or distributing a controlled substance as of the end of the tax year.

Lifetime learning credit. A student who is enrolled in one or more courses at an eligible educational institution.

Student loan interest deduction. A student who was enrolled at least half-time in a program leading to a postsecondary degree, certificate, or other recognized educational credential at an eligible educational institution.

A student who is enrolled for at least half the full-time academic workload for the course of study the student is pursuing, as determined under the standards of the school where the student is enrolled.

American opportunity credit. Adjusted gross income (AGI) as figured on the federal income tax return, modified by adding back any:

Coverdell education savings account (ESA). Same as American opportunity credit in this category.

Education savings bond program. AGI as figured on the federal income tax return without taking into account any savings bond interest exclusion and modified by adding back any:

Student loan interest deduction. AGI as figured on the federal income tax return without taking into account any student loan interest deduction, and modified by adding back any:

The amount of credit or deduction allowed is reduced when the MAGI is greater than a specified amount of income.

See the pertinent chapter for specific items.

American opportunity credit. Tuition and certain related expenses (including student activity fees) required for enrollment or attendance at an eligible educational institution. Books, supplies, and equipment needed for a course of study are included even if not purchased from the educational institution. Doesn't include expenses for room and board. Doesn't include expenses for courses involving sports, games, or hobbies (including noncredit courses) that aren't part of the student's postsecondary degree program.

Coverdell education savings account (ESA). Expenses related to or required for enrollment or attendance of the designated beneficiary at an eligible elementary, secondary, or postsecondary school. Includes computer or peripheral equipment, computer software, or Internet access and related services. Many specialized expenses included for K–12. Also includes expenses for special needs services and contributions to a QTP.

Education savings bond program. Tuition and fees required to enroll at or attend an eligible educational institution. Also includes contributions to a QTP or Coverdell ESA. Doesn't include expenses for room and board. Doesn't include expenses for courses involving sports, games, or hobbies that aren't part of a degree or certificate-granting program.

IRA, early distributions from. Tuition, fees, books, supplies, and equipment required for enrollment or attendance at an eligible educational institution, plus certain limited costs of room and board for students who are enrolled at least half-time. Also includes expenses for special needs services incurred by or for special needs students in connection with their enrollment or attendance.

Lifetime learning credit. Tuition and certain related expenses required for enrollment or attendance at an eligible educational institution. Student activity fees and expenses for course-related books, supplies, and equipment are included only if the fees and expenses must be paid to the institution as a condition of enrollment or attendance. Doesn't include expenses for room and board. Doesn't include expenses for courses involving sports, games, or hobbies (including noncredit courses) that aren't part of the student's postsecondary degree program, unless taken by the student to acquire or improve job skills.

Qualified tuition program (QTP). Tuition, fees, books, supplies, and equipment required for enrollment or attendance at an eligible higher educational institution, plus certain limited costs of room and board for students who are enrolled at least half-time. Includes computer or peripheral equipment, computer software, or Internet access and related services. Also includes expenses for special needs services and computer access. Also, for amounts paid from distributions made after 2017, includes no more than $10,000 of elementary and secondary school (K–12) tuition incurred after 2017.

Scholarships and fellowship grants. Expenses for tuition and fees required to enroll at or attend an eligible educational institution, and course-related expenses, such as fees, books, supplies, and equipment that are required for the courses at the eligible educational institution. Course-related items must be required of all students in the course of instruction.

Student loan interest deduction. Total costs of attending an eligible educational institution, including graduate school (however, limitations may apply to the cost of room and board allowed).

To include as income on your current year's return an amount allowed as a deduction in a prior year. To include as tax on your current year's return an amount allowed as a credit in a prior year.

A tax-free distribution to you of cash or other assets from a tax-favored plan that you contribute to another tax-favored plan.

A movement of funds in a tax-favored plan from one trustee directly to another, either at your request or at the trustee's request.

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SEG grants fund summer internships, research projects

Summer Experience Grants

By | Kathy Hovis , A&S Communications

Hamid Rezaee ’26 spent this summer at Cornell Tech in New York City, working to refine a computer model that will help radiologists detect small cancer cells before they spread further in the body.

He was among the 119 students from the College of Arts & Sciences awarded Summer Experience Grants (SEG) this year. The grants help students pay for housing, food, transportation and other expenses while they undertake minimally-paid or unpaid summer internships or positions.

Rezaee, a computer science major, has spent the last two summers interning and conducting research in New York City, first with a startup aerospace company and now with a research team at Cornell Tech and Weill Cornell Medical Center.

“I’m well over 200 to 300 failed experiments at this point,” Rezaee said in July, quickly adding that that’s actually a good thing. “My task is to train this model to spot cancer cells using fMRI images of brain scans. And these can be as small as 4 pixels.”

He edits his model every day, “penalizing” the model if it makes a mistake, making refinements and then running the model every night. In the morning when he comes to campus, he discovers if it made fewer errors.

If all goes well, at the end of the summer or into the fall, the model will surpass other existing models for detection of the smallest cancer cells. And Rezaee will be included as an author on the paper that his supervisor, doctoral student Rachit Saluja (in Mert Sabuncu ’s lab at Cornell Tech), would write to introduce this new tool to researchers and radiologists.

“It would be amazing for me to contribute this to the medical community,” Rezaee said.

The experience wouldn’t be possible, he said, without the SEG grant, which helped provide funding for the metro, food and housing at St. John’s University.

“I wouldn’t have been able to accomplish any of this without the grant,” he said. 

Other students who used SEG funding to explore their futures this summer included:

• Isabella Riano ’25, who interned with a non-profit dedicated to helping immigrant children with legal representation
• Nika Makoviak ’25, who spent the summer in Los Angeles, working with actors and directors at the Stella Adler Academy of Acting
• Eva Farroha ’25 , who investigated an RNA binding protein complex at the National Institutes of Health (NIH) in Maryland
• Olivia D'Ambrosio ’26, who worked in Commonwealth Financial Network’s Anti Money Laundering team and special investigations unit
• Mnumzana Moyo ’26, who interned with Emzini weCode, helping high school students in Zimbabwe learn computer coding

Riano said the SEG funding took away the stress she was feeling about taking an unpaid internship in Manhattan and commuting from her family home on Long Island. “Going to the city is $20 one way and getting food and professional clothes…I wasn’t sure how I was going to finance everything,” she said. “The SEG grant allowed me to focus on my job without having a financial burden.”

Riano spent her days working with attorneys at Safe Passage Project and their clients, young children or teenagers facing deportation.

“A lot of them are unaccompanied minors (who) crossed the border, coming from a place of neglect, abuse and poverty or escaping gang violence,” she said. “They have suffered through trauma and violence and are taking the chance to come here for a better life.”

A government and American studies major with minors in Latino studies and migration, Riano plans to attend law school and has an interest in immigration law. She has worked with the Cornell Defender Program, a pre-professional program run by Cornell’s Office of Academic Diversity Initiatives for students interested in exploring family and criminal law. She also spent a semester studying in Australia, where she worked with a program helping people seeking asylum there. “I’ve learned to use this sadness in a healthy way – it inspires me and pushes me forward,” she said.

Riano said she’s been frustrated to learn it can take many years for child immigrants to receive employment papers and a green card. 

“I met 15 and 16-year-old girls from Honduras fleeing violence who talked about taking buses and cars and walking the whole way through Mexico and into the U.S.,” she said. 

Riano said she’s wanted to be a lawyer since middle school, but this summer work has helped her “better understand the kind of law I want to pursue.”

Makoviak, who is from Kyiv, Ukraine, said finding a summer internship as an international student is a complex process, requiring approval from several institutions.

“I knew I wanted to do something related to film/theatre production, so I wrote around 60 emails to different theatre and film production companies,” said Makoviak, who is studying government and performing and media arts. “SEG allowed me not only to cover my basic needs but make my dream real. When I saw that the Academy is located at Hollywood Boulevard, I got speechless.”

Makoviak worked as a production assistant under director Chris Thornton, on the play “Noises Off.”

 “Not only do I get to substitute actors at rehearsals (and practice my acting) but I also learn about set and prop design,” she said. “Most importantly, I learn a lot about directing and director-actor dynamics. Listening to Chris working with the actors is like being on a 3-4 hour lecture on directing.” 

Makoviak said the grant funding also allowed her to volunteer at short film festivals including LA Shorts and HollyShorts, where she met many passionate artists.

“This internship convinced me once more that it is crucial to follow your dreams,” she said.

Farroha, a biological sciences major with a concentration in computational biology who plans to attend medical school, worked in NIH’s National Heart, Lung, and Blood Institute last summer, so she chose to accept a position within the National Institute of Arthritis and Musculoskeletal and Skin Diseases branch this year.

“I saw similarities between my favorite course BIOMG 4400 and the lab's research interests,” she said. “I was hoping to use the skills I already had learned in class while also engaging in new techniques.”

The protein complex Farroha studied is responsible for the production of functional sperm and ovaries. When the complex is disrupted, she said, it results in infertility. 

 “My project was to see how mutations in DND1 at its RNA binding regions affect the functionality of the whole complex,” she said. “This involved using predictive AI software to determine intramolecular interactions, constructing 8 mutant cell lines and performing a variety of experiments.”

The summer experience heightened her interest in research as she moves toward medical school, Farroha said.

“Conducting a research project allowed me to engage in critical thinking and professionalism,” she said. “I also think research is super valuable for the presentation aspect, which directly translates to how important effective communication is in the doctor-patient relationship.”

D'Ambrosio, a government major, said her summer work offered the chance to work on a legal team while also  learning the intricacies of financial compliance.

“My role encompassed conducting due diligence reviews, managing regulatory responses and preparing detailed case reports,” she said. “I also conducted monitoring projects aimed at fraud prevention and analyzed transactional data to identify and address risk patterns impacting clients.”

For her capstone project, she collaborated with other interns, developing and presenting a new strategic initiative to the company’s board of partners.

“This experience has not only solidified my commitment to attending law school but has also strengthened my ambition to pursue a career that bridges finance and law, with a particular focus on financial compliance or corporate law,” she said.

The SEG funding was vital, she said, as the company is located in Boston, so housing and living expenses were steep. 

Moyo, a computer science major from Zimbabwe, said he never felt encouraged to pursue a tech career until he got to Cornell, “so volunteering at Emzini weCode was a chance for me to change that narrative for other youths in Zimbabwe so that they would be more informed about computer science when they get into college.”

Along with teaching students, Moyo conducted research aimed at enhancing the hands-on learning experience for first-time coders and created content and helped with administrative tasks for the organization.

“I found so much joy teaching students how to code,” he said. “I want to be involved in a career where I get to work with young people to help them realize their potential and reach for the power to express themselves through technology.”

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Home / News / University News / FSU aims to be No. 1 research university with lowest student debt

FSU aims to be No. 1 research university with lowest student debt

As college students across the nation consider taking out loans as they head back to campus for another school year, Florida State University has set its sights on becoming the best public research university in the country for graduating students with little or no debt.

President Richard McCullough said it’s an audacious goal but an attainable one.

FSU is already among the Top 12 public research universities when it comes to low student debt, he said, and the university could be No. 1 in the next couple of years.

“I think it’s really important that we not only deliver an amazing education to our students, but we also do it in a way that’s the lowest cost,” said McCullough, noting that FSU has one of the lowest tuitions in the country.

He said that when students graduate with debt, “it makes it harder to get your life started. That’s the last thing we want to saddle our students with and burden them with.”

Helping to spearhead the university’s multifaceted strategy to support students’ financial wellness is Associate Provost and Dean of Undergraduate Studies Joe O’Shea.

“We want to graduate our students with the lowest debt possible among public research universities in this country,” O’Shea said. “It’s a goal we’re already very close to achieving.”

Currently, about 32% of FSU undergraduates graduate with some debt, with an average of $14,500 — a figure that has been decreasing each year. This puts FSU well below the national average of $29,400 in student loan debt at graduation.

O’Shea said that while student loans can play an important role in financing education, FSU is focused on preventing excessive debt that could negatively impact students’ futures.

“We are committed to doing everything possible to make sure our students thrive during their time at FSU and can launch successfully when they graduate,” he said. “Part of that commitment is their financial wellness and ensuring they have the resources they need to continue at FSU and engage fully in their education.”

In fact, 86.3% of full-time undergraduates received some form of non-loan student financial aid during the 2022-2023 academic year.

Florida has among the lowest public university tuition in the country, making FSU among the most affordable in the country for a world-class educational experience, according to O’Shea. Florida State has not raised the price of tuition for the past 11 years.

“This is part of FSU’s commitment to making sure our education is as accessible as possible,” he said.

FSU students graduate on time, which helps minimize debt by reducing the time students spend accumulating expenses. The university has one of the highest four-year graduation rates in the country — 75% of FSU’s students graduate in four years.

“Our students are not staying for five or six years and accumulating debt. Our focus on timely graduation is a key part of our strategy,” O’Shea said.

FSU’s efforts to minimize student debt are rooted in a strategy that includes financial education, increased scholarship funding and innovative support programs. O’Shea highlighted several key components of the approach:

Expanded scholarships and grants

Through the support of alumni, donors and legislative backing, FSU has significantly increased the amount of scholarship dollars available to students. FSU distributed more than $105 million in scholarships last year.

“We’ve been able to bring the average debt levels down incrementally for each graduating class,” O’Shea said. “This is thanks to the incredible generosity of our donors and the strong institutional and legislative support.”

Notable examples include significant gifts for first-generation students, women in STEM and other scholarship programs.

“It really is such a beautiful approach in which so many people who care about FSU and about students are coming together to make sure that our students have what they need to thrive during their time in college and beyond,” O’Shea said.

Financial literacy education

Recognizing the importance of financial education, FSU has launched initiatives such as the Unconquered by Debt Program. This program, led by Joe Calhoun, former chair of FSU’s economics department, provides outreach and peer education to help students understand finances, student loans, credit, budgeting and long-term financial planning.

Targeted support for vulnerable students

Programs like CARE , or the Center for Academic Retention and Enhancement, offer scholarships and holistic support for first-generation and Pell-eligible students. Recently, FSU introduced the Quest Scholars and Illuminate programs, which provide annual scholarships and $2,000 enrichment funds to support experiential learning opportunities like study abroad and internships.

Paid internships and work opportunities

Programs like InternFSU and InternFSU:TLH partner with university departments and local businesses to provide paid internships. The university also employs hundreds of students in roles like peer mentors and learning assistants.

Reducing textbook costs

University Libraries has adopted free open educational resources to reduce the financial burden of textbooks.

Retention and persistence grants

To ensure students can continue their education without interruption, FSU has established funds to support students facing financial challenges.

“We’ve been able to help hundreds of students stay at FSU when they were facing the choice of not continuing due to financial difficulties,” O’Shea said.

O’Shea noted that while recent federal complications disrupted this year’s financial aid process, FSU remains committed to its long-term goals.

“We’re in it for the long game,” he said. “This will forever be important.”

The success of these initiatives is heavily reliant on the contributions of FSU’s community of donors and legislative allies, O’Shea said.

“With continued partnership and support, we can achieve this goal and ensure that our graduates can launch their careers with as little debt as possible,” he said.

While the full impact of these initiatives may take years to fully materialize in the data, O’Shea said FSU is committed to continually improving its support for students’ financial well-being.

“The return on an FSU education is far more than just financial,” O’Shea said. “We are empowering our students to excel across all their roles — as employees, neighbors, citizens and friends. Our communities depend on the kind of educational experience we provide.”