The Consolidated Appropriations Act (CAA) has aligned the income phaseout rules for two education credits. Taxpayers generally can claim an education tax break with the American Opportunity Tax Credit (AOTC) and the Lifetime Learning Credit (LLC). Previously, the two credits were subject to different income phaseout rules, with the AOTC available at a greater modified adjusted gross income than the LLC. The CAA adopts a single phaseout for both the AOTC and the LLC, effective for tax years beginning after Dec. 31, 2020. The credits will phase out beginning at $80,000 for single filers and ending at $90,000. For joint filers, they will begin to phase at $160,000 and disappear at $180,000. Call or visit our website for more information! www.mjscpa.com/
