Joined: 08 Jan 2010 Location: United States
Online Status: Offline Posts: 107
Posted: 14 Jan 2010 at 12:05 | IP Logged
The Hope credit is not being replaced. The American Opportunity credit is simple being added into the mix of education credits for 2009
and 2010 tax returns.
Both credits are very similar with the following exceptions:
1. Max credit for AO credit is $2,500. Max Credit for Hope credit is $1,800.
2. AGI phaseout threshholds are significantly higher for AO credit.
3. AO credit is available for first 4 years of college whereas hope is still only for the first two.
4. Up to 40% of the AO credit is refundable, depending on the AGI of the taxpayer, the rest is nonrefundable. The Hope is completely
nonrefundable.
Refer to the 2009 instructions for IRS form 8863 for more information. I've summarized what I think is significant above.
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Topic: American Opportunity Credit
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