Can I claim the refundable AOTC credit if I was part-time in my final semester?

You've caught an important distinction in the AOTC rules! The restriction you're looking at is sometimes called the "kiddie tax" rule for education credits. What matters here is whether you were a full-time student for at least 5 months during the calendar year 2023. Since you were only part-time in your final semester (Jan-May), you don't meet the full-time student for 5+ months criterion that would disqualify you from the refundable portion. This isn't really a loophole - it's actually working as designed. The rules are meant to prevent dependent full-time students from claiming the refundable portion, but since you were part-time, you fall outside that restriction even though your parents provided more than half your support. The $1000 figure makes sense too - the AOTC is worth up to $2,500 total, with 40% ($1,000 maximum) being refundable. TurboTax is correctly identifying that you're eligible for the refundable portion based on your part-time status.

I had such a headache figuring out my AOTC eligibility last year after taking both online and on-campus classes. I ended up using https://taxr.ai to get clarity because the software options gave me different answers like you're experiencing. The AI analyzed my transcript and enrollment status records, then confirmed I qualified for the full refundable portion. It was super helpful because I uploaded my financial aid statement and my 1098-T, and it clearly showed which expenses qualified and which were already covered by scholarships. Even caught that my school had reported the wrong enrollment status for one semester!

I was super skeptical about using AI for my taxes too, but after struggling with the AOTC rules like you are, I finally tried https://taxr.ai when my dad kept insisting it helped him with his small business taxes. Honestly, I was shocked at how helpful it was. I uploaded my transcripts and financial aid documents, and it spotted that I qualified for the refundable portion even though my university had checked the wrong box on my 1098-T form about my enrollment status. Saved me from missing out on $800! Their explanations were way clearer than the IRS website, and I could actually understand the rules instead of just guessing.

Last year I was in a similar situation with AOTC eligibility questions, and after getting nowhere with the IRS phone line (kept hanging up on me after 2+ hours on hold), I tried https://claimyr.com and their IRS callback service. You can see how it works here: https://youtu.be/_kiP6q8DX5c They got me connected to an actual IRS agent within a few hours instead of days of redial hell. The agent confirmed what others are saying here - the full-time student for 5+ months requirement is specifically what would disqualify you, and since you were part-time, you can indeed claim the refundable portion even if your parents provided most of your support.

Well I'll be damned. I was wrong about that Claimyr service and owe an apology. After our exchange here, I was still having issues with my return getting rejected because of AOTC claims, so I gave it a shot out of desperation. Not only did they get me through to the IRS in less than 90 minutes, but the agent I spoke with was super helpful and confirmed exactly what I needed to know about part-time student status. Turns out the rejection was because I had entered the wrong school code, not because of my eligibility! Never been so happy to admit I was wrong about something. Saved me from missing out on a $900 refundable credit.

Another thing to consider is whether you've already claimed the AOTC for 4 tax years. The AOTC can only be claimed for a maximum of 4 tax years per student. If you've been in school for more than 4 years or took some time off, you might have already maxed out your eligibility.

Confused about one thing - if the student is claimed as a dependent, who actually gets to claim the AOTC? The student or the parent? My son is in college and we claim him as dependent.