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The amount of qualified education expenses used to calculate the american opportunity tax credit (aotc) is:

a. $2,500
b. $4,000
c. $15,000
d. $16,500

User Li Jin
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1 Answer

2 votes

Final answer:

option a,The correct answer is (b) $4,000. This amount refers to the maximum qualified education expenses used to calculate the American Opportunity Tax Credit (AOTC), which can result in a credit of up to $2,500 per eligible student.

Step-by-step explanation:

The amount of qualified education expenses used to calculate the American Opportunity Tax Credit (AOTC) is not explicitly listed in the options provided: a) $2,500 b) $4,000 c) $15,000 d) $16,500. The AOTC is a credit for qualified education expenses paid for an eligible student for the first four years of higher education. To clarify, the credit can be up to $2,500 per eligible student and is calculated as 100% of the first $2,000 of qualified expenses and 25% of the next $2,000. Therefore, the maximum amount of qualified education expenses used to calculate the AOTC is $4,000, which leads to a maximum credit of $2,500.

It is worth noting that while the question asked about the AOTC, the provided reference information discusses the Earned Income Tax Credit (EITC), which is a separate tax credit aimed at assisting low-income working families. The EITC is a refundable tax credit, which means that it can reduce the amount of tax owed and may result in a refund if it is more than the tax liability. The amount of the EITC varies by income, family size, and other factors.

User JonHendrix
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