American Opportunity Credit 2009/2010

I have friends who say they received a $4000 deduction from the Hope Credit on their 2008 return and they are wondering if they will qualify for an additional "up to" $2500 rebate from the American Opportunity Credit in 2009.

The IRS states it is a modification to the Hope Credit, so I am under the assumption that they will only receive a rebate according to their tax rate and their qualifying higher education-related expenses.

http://articles.moneycentral.msn.com/CollegeAndFamily/CutCollegeCosts/how-to-get-a-2500-dollar-tuition-rebate.aspx

http://www.irs.gov/newsroom/article/0,,id=205674,00.html

Dingobisquit,

Hope is a tax credit. For 2008 a student in a Midwestern Disaster Area could qualify for a tax credit of up to $3,600 ($1,800 outside of the disaster area). This is a per qualifying student tax credit.

The act that you refer to enhances the Hope tax credti for tax years 2009 and 2010.
The student may qualify for the tax credit each year. Previously the Hope Tax Credit could only be used in the first 2 years of higher education. This act makes it availaable for 4 years of post secondary education (college), but not after 2010, unless our Congress buddies change the law.

The Life Time Learning Tax Credit of up to $2,000 is a per tax return credit. This credit is doubled to $4,000 in 2008 for students in the Mid Western Disaster Area.