If you're thinking about seeking the Lifetime Learning Credit, it's a good idea to first take a good, hard look at yourself. Or at least at your income and school-related expenses.
The size of the credit depends in part on the amount of your eligible expenses. The LLC covers 20 percent of up to $10,000 in tuition and other costs. For those students who aren't majoring in math, that means you can get up to $2,000 in expenses credited to you for tax purposes. So whether school costs you $15,000 or $150,000 in a given year, you're still going to get the same $2,000 credit [source: IRS].
Like many tax credits, the LLC is intended primarily for people that the government thinks could use the help. That means it comes with some income restrictions. In 2014, a person whose modified adjusted gross income (MAGI) is $52,000 or less ($104,000 for joint followers) is eligible for the full amount of the credit: 20 percent of up to $10,000 in expenses. Individuals whose MAGI is more than $52,000 and less than $62,000 ($124,000 for joint filers) can still get some of the credit, at a reduced rate. More than $62,000 means you can't claim the credit [source: IRS]. Your MAGI is your gross income with certain deductions subtracted and others added.
The tricky part for some tax filers is making sure that you get all of the credit to which you're entitled. The LLC isn't refundable. That means that, if the government already owes you a tax refund, Uncle Sam won't include the LLC amount in the check that it -- eventually -- sends you. A person or family can look to get around this by reducing withholdings from paychecks or elsewhere to make sure that they owe at least some taxes at the end of the year [sources: IRS]
Unless you're using that credit to learn accounting and tax law, it also might be a good idea to consult a professional before filing.