Can Parents & Students Both Claim Tuition Tax Credits?
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College tuition is not just rising, it is sprinting ahead of inflation. Every semester brings higher bills and for many families, easing that financial burden becomes a yearly puzzle. Although the once-popular federal Tuition and Fees Deduction has expired, there are still a few tax breaks that can help parents and students save money on education expenses.
The big question many families ask each year is: Can both the parent and the student claim tuition costs on their federal taxes? The short answer is no, but some rules allow one or the other to benefit, depending on who paid for the education and how the student is claimed on tax returns.
What Happens to the Tuition & Fees Deduction?
Until recently, taxpayers could reduce their taxable income by up to $4,000 through the Tuition and Fees Deduction, provided they paid for qualified education expenses.
However, that deduction expired at the end of 2020. It was a popular benefit because it reduced taxable income directly. However, the government decided to streamline education tax benefits by expanding the American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit (LLC) instead.
Two Major Education Tax Credits
When it comes to claiming current education expenses, two federal tax credits take center stage — the AOTC and the LLC.
The AOTC benefit offers a credit of up to $2,500 per year for each eligible student, covering expenses for the first four years of undergraduate education. The best part is that it is refundable, which means even if you owe no taxes, you can still get some cash back.
To qualify, the student must be enrolled at least half-time in a degree program. The credit phases out for higher-income earners, specifically, those with a modified adjusted gross income (MAGI) above $80,000 for single filers or $160,000 for joint filers.
The LLC, alternatively, offers up to $2,000 per return — not per student. It is available for any level of post-secondary education, including graduate and professional courses. There is no limit to the number of years you can claim it, making it ideal for lifelong learners or parents paying for continuing education. However, it is non-refundable, meaning it can cut your tax bill to zero but will not generate a refund.
Who Gets to Claim: Student or Parent?
This is where things can get tricky. Generally, only one taxpayer can claim an education credit per student, per year. If a student is listed as a dependent on a parent’s return, the parent gets to claim the credit — even if the student paid the tuition with their savings.
If the student is not claimed as a dependent, they can claim the AOTC or LLC themselves, provided they meet income and eligibility rules.
To simplify
1. If the parent claims the student as a dependent, the parent claims the credit.
2. If the student files independently, the student claims it.
The important point is that the same expenses cannot be double-counted. The parent and the student cannot both claim the same tuition payment on their separate returns.
MAGI Limits Matter
Both credits phase out for higher-income taxpayers. For 2025, the income phase-outs remain consistent:
AOTC: Begins at $80,000 ($160,000 for joint filers) and ends at $90,000 ($180,000 for joint filers).
LLC: Same thresholds apply.
If your income exceeds these levels, you will lose access to the credits altogether, regardless of how much you spent on tuition.
Bottom Line
The end of the tuition and fee deduction did not spell the end of tax relief for education. Instead, the government shifted its focus toward credits that directly reduce what you owe.
If you are a parent helping your child through college, or a student footing your bill, understanding who can claim the credit and when can help you save money. Just remember, one student, one credit and one taxpayer per year. That is the golden rule when it comes to tuition tax benefits.