OBBB Act: Education Credits

August 14, 2026

On July 4, 2025, President Trump signed the One Big Beautiful Bill (OBBB) Act into law. The OBBB Act includes a number of tax changes affecting individuals, including the provision to provide a social security number (SSN) rather than a taxpayer identification number (TIN) in order to claim the American Opportunity or lifetime learning tax credit.

Background

There are two credits available to help taxpayers offset the costs of higher education -

the American opportunity tax credit (AOTC) and the lifetime learning credit (LLC).

The American opportunity tax credit is:

• Worth a maximum benefit up to $2,500 per eligible student.

• Only for the first four years at an eligible college or vocational school.

• For students pursuing a degree or other recognized education credential.

• Partially refundable. This means if the credit brings the amount of tax owed to zero, 40 percent of any remaining amount of the credit, up to $1,000, is refundable.

  The lifetime learning credit is:

• Worth a maximum benefit up to $2,000 per tax return, per year, no matter how many students qualify.

• Available for all years of postsecondary education and for courses to acquire or improve job skills.

• Available for an unlimited number of tax years.

To be eligible to claim the American opportunity tax credit, or the lifetime learning credit, a taxpayer or a dependent must receive a Form 1098-T from an eligible educational institution with few exceptions. The credits are subject to income limits: to claim the full amount, income must be below $80,000 for single taxpayers ($160,000 married filing jointly). Taxpayers cannot claim either credit if income exceeds $90,000 ($180,000 married filing jointly).  

In general, qualified tuition and related expenses for the education tax credits include tuition and required fees for the enrollment or attendance at eligible post-secondary educational institutions (including colleges, universities and trade schools). The expenses paid during the tax year must be for: an academic period that begins in the same tax year or an academic period that begins in the first three months of the following tax year. For the AOTC but not the LLC, qualified tuition and related expenses include amounts paid for books, supplies and equipment needed for a course of study.

Changes under the OBBB Act

For 2026 and later, the OBBB Act requires:

• The taxpayer claiming the credit to include the taxpayer’s social security number on the return

• The student’s social security number if the credit if for someone other than the taxpayer or spouse, and

• The institution's EIN for the American Opportunity Credit.