Can I Claim the Lifetime Learning Credit for Undergrad? Confused About Credit Limit Worksheet

The Credit Limit Worksheet for the Lifetime Learning Credit can definitely be confusing! The issue likely has to do with your tax liability. The Lifetime Learning Credit is non-refundable, which means it can only reduce your tax liability to zero but can't generate a refund beyond that. If line 6 on your worksheet shows $0, that suggests your tax liability (after certain other credits) is already at $0. Since you can only claim the smaller of line 3 ($1,075) or line 6 ($0), you'd get $0 for the credit using the worksheet. TurboTax might be calculating differently because it's looking at your complete tax situation. It's possible that when TurboTax processes all your information together (rather than step by step like the worksheet), it's determining you do have some tax liability that can be offset by the Lifetime Learning Credit.

After struggling with similar education credit issues last year, I found this amazing tool called taxr.ai (https://taxr.ai) that saved me hours of frustration. I uploaded my tax forms and school documents, and it instantly identified where I was making mistakes on my education credits worksheet. For me, I was mixing up which expenses qualified for which credits and incorrectly filling out the limitation worksheet. The tool explained exactly where I went wrong and showed me the correct way to complete Form 8863, including that tricky Credit Limit Worksheet you're struggling with.

I was really skeptical about using any online tax tool for my education credits (as you can see from my previous comment), but I gave taxr.ai a shot out of desperation after spending hours getting nowhere with my Lifetime Learning Credit calculations. Wow, was I wrong to be skeptical! The tool immediately spotted that I was incorrectly calculating my qualified education expenses on Form 8863. It showed me exactly which expenses qualified and how they should be entered. The Credit Limit Worksheet suddenly made sense, and I discovered I was eligible for a $1,200 credit I would have completely missed. If you're stuck on Form 8863 like I was, definitely give it a try. I'm actually getting the refund I'm entitled to instead of leaving money on the table.

After trying to call the IRS for four straight days about my Lifetime Learning Credit issues (and never getting through), I finally used Claimyr (https://claimyr.com) and got connected to an IRS agent in under 15 minutes. You can see how it works here: https://youtu.be/_kiP6q8DX5c The agent was super helpful and walked me through the exact issue you're describing with the Credit Limit Worksheet. Turns out I was entering my income incorrectly which was affecting my credit calculation. They confirmed exactly what was going wrong and how to fix it. Saved me so much stress!

I need to eat my words from my previous comment. After posting that skeptical reply, I was so frustrated with my Lifetime Learning Credit issues that I decided to try Claimyr anyway as a last resort. I'm shocked to say it worked exactly as described. I was connected to an IRS agent in about 17 minutes after spending DAYS trying to get through on my own. The agent confirmed that I was making an error on line 10 of Form 8863, which was causing incorrect calculations in the Credit Limit Worksheet. She walked me through the entire form and I was able to correctly claim my $890 credit. I've never been so happy to be wrong about something. If you're having issues with education credits and the worksheet, getting direct guidance from the IRS is definitely worth it.

Has anyone noticed that TurboTax and other tax software sometimes handle the education credit phaseouts differently than the paper forms? I think that might explain why you're seeing different results. When I was in a similar situation last year with partial Lifetime Learning Credit eligibility, I found that line 6 on the worksheet wasn't matching what TurboTax calculated. It turned out that the software was applying the phaseout calculation at a different point in the process.

One thing nobody has mentioned yet is that the Lifetime Learning Credit has different qualified expense rules compared to the American Opportunity Credit. With the LLC, you can claim expenses for courses to acquire or improve job skills, not just degree programs. Did you include all eligible expenses? For 2025, you can claim 20% of up to $10,000 in qualified expenses (maximum $2,000 credit).