Question: Can I claim an education credit for higher education expenses paid by a government-subsidized loan?
Yes, higher education expenses paid with the proceeds of a government-subsidized loan may qualify for the credit if you must repay the loan. Additionally, you claim the credit in the year in which you pay the expenses, not in the year in which you repay the loan.
- Publication 970, Tax Benefits for Education
- Education Credits: Questions and Answers
- Education Credits--AOTC and LLC
- Form 8863 (.pdf), Education Credits (American Opportunity and Lifetime Learning Credits)
Category: Child Care Credit, Other Credits
Subcategory: Education Credits