IRS Publication 5198 – If you or a loved one is heading to college, pursuing a certificate program, or taking courses to boost job skills, you could qualify for valuable tax savings. IRS Publication 5198 (Rev. December 2025) is a concise, one-page flyer designed to help taxpayers quickly understand two key education tax credits: the American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit (LLC).
This official IRS resource answers the question in its title and directs readers to deeper details on IRS.gov. Download the free PDF here: https://www.irs.gov/pub/irs-pdf/p5198.pdf.
What Is IRS Publication 5198?
Published by the Department of the Treasury, Internal Revenue Service (Catalog Number 67468K), Publication 5198 serves as an easy-to-read introduction to education-related tax benefits. It highlights how the AOTC and LLC can offset qualified tuition and related expenses for postsecondary education or job-skill improvement.
The flyer emphasizes:
- These credits apply whether you’re a student, parent claiming a dependent, or even taking courses yourself to advance your career.
- Only one credit per student per tax year.
- Additional benefits like the Credit for Other Dependents or Earned Income Tax Credit may also apply.
It points readers to the comprehensive Tax Benefits for Education Information Center on IRS.gov and Publication 970, Tax Benefits for Education for full rules.
The Two Main Education Tax Credits Explained
1. American Opportunity Tax Credit (AOTC)
The AOTC helps cover the first four years of postsecondary education.
- Maximum credit: Up to $2,500 per eligible student per year (100% of the first $2,000 + 25% of the next $2,000 of qualified expenses).
- Refundable portion: Up to $1,000 can be refunded even if you owe no tax.
- Key requirements:
- Student must be enrolled at least half-time in a program leading to a degree, certificate, or other recognized credential.
- Available only for the first 4 years of postsecondary education.
- No felony drug conviction related to controlled substances for the student.
- Qualified expenses: Tuition, enrollment fees, and required course materials (books, supplies, equipment) needed for the course of study — even if not paid directly to the school.
2. Lifetime Learning Credit (LLC)
The LLC is more flexible and ideal for ongoing education or career development.
- Maximum credit: Up to $2,000 per tax return per year (20% of the first $10,000 of qualified expenses for all students on the return).
- Key advantages:
- No degree or credential program required.
- Covers any postsecondary courses, including those taken to acquire or improve job skills.
- Available for unlimited years (undergraduate, graduate, professional, or skill-building classes).
- No half-time enrollment minimum — just one or more courses.
- Qualified expenses: Primarily tuition and enrollment fees. Books, supplies, and equipment qualify only if required to be paid directly to the school.
Publication 5198 specifically calls out the LLC for “courses to acquire or improve job skills,” making it perfect for professionals upgrading certifications, learning new software, or transitioning careers.
AOTC vs. LLC: Quick Comparison (From IRS Resources)
| Feature | American Opportunity Tax Credit (AOTC) | Lifetime Learning Credit (LLC) |
|---|---|---|
| Max Credit | $2,500 per student | $2,000 per return |
| Refundable? | Partially (up to $1,000) | No |
| Program Type | Degree/certificate program | Any course, including job skills |
| Enrollment | At least half-time | One or more courses |
| Years Available | First 4 years of postsecondary education | Unlimited |
| Best For | Recent high school grads or early college years | Graduate students, career changers, skill upgrades |
(Source: IRS Publication 5198 and Education Credits: AOTC and LLC page, updated December 2025)
Who Qualifies and How to Claim the Credits?
You (or your spouse/dependent) can claim these credits if:
- Expenses were paid for an eligible student at an eligible educational institution.
- You paid the qualified expenses in 2025 (or early 2026 for 2025 academic periods).
- The student has a valid Social Security Number, ITIN, or ATIN.
Steps to claim:
- Receive Form 1098-T (Tuition Statement) from the school.
- Complete Form 8863, Education Credits and attach it to your Form 1040 or 1040-SR.
- Use IRS Free File, tax software, or a professional preparer.
Income limits for 2025 (Modified Adjusted Gross Income — MAGI):
- Full credit generally available if MAGI is $80,000 or less ($160,000 or less if married filing jointly).
- Partial credit possible up to $90,000 ($180,000 MFJ).
- No credit if MAGI exceeds $90,000 single / $180,000 joint.
Exact phaseout ranges and calculations appear in the 2025 Instructions for Form 8863 and Publication 970. Use the IRS Interactive Tax Assistant tool on IRS.gov to check eligibility quickly.
Other Valuable Tax Benefits Mentioned in Pub 5198
- Credit for Other Dependents (ODC) — Up to $500 for dependents who don’t qualify for the Child Tax Credit.
- Earned Income Tax Credit (EITC) — Especially helpful for lower- and moderate-income families with students.
- Student loan interest deduction and education savings plans (529 plans, Coverdell ESAs) are covered in greater detail in Publication 970.
Frequently Asked Questions (FAQs)
Can I claim both credits in the same year?
Yes — but only one per student. You can claim AOTC for one child and LLC for another on the same return.
Do job-training courses qualify?
Yes, under the Lifetime Learning Credit if they help acquire or improve job skills at an eligible institution.
What if I didn’t receive Form 1098-T?
You can still claim the credit with proper records (receipts, statements) substantiating qualified expenses.
Are online or non-degree courses eligible?
Yes for LLC, as long as the institution is eligible and the courses improve job skills or are part of postsecondary education.
Final Tips and Next Steps
IRS Publication 5198 is your quick-start guide, but always consult the full details in Publication 970 (Tax Benefits for Education) for your specific situation. Tax rules can change, and 2025 limits are current as of the latest IRS updates (December 2025–February 2026).
Action steps:
- Download Publication 5198 → Direct PDF link
- Visit the IRS Tax Benefits for Education Information Center
- Use the IRS Interactive Tax Assistant for personalized eligibility checks
- Talk to a tax professional or use IRS Free File if your income qualifies
Important disclaimer: This article summarizes official IRS information for educational purposes only. Tax laws are complex and individual circumstances vary. For personalized advice, consult a qualified tax professional or refer directly to IRS.gov and Publication 970. The IRS does not endorse any third-party content.
Stay informed and maximize your education tax savings in 2026 filing season! For the latest updates, bookmark IRS.gov/education.