Lifetime learning education credit

[cpabsd]

Taxpayer redeemed savings bonds and used monies to pay for dependents tuition expenses. Total tuition was $4200. Excludable savings bond interest is $2597. Can difference in two numbers be used to claim lifetime learing credit or can the full amount be used for education credit? I have looked and cannot find this covered in any of my resources.

Thanks.

[RitaB]

Taxpayer redeemed savings bonds and used monies to pay for dependents tuition expenses. Total tuition was $4200. Excludable savings bond interest is $2597. Can difference in two numbers be used to claim lifetime learing credit or can the full amount be used for education credit? I have looked and cannot find this covered in any of my resources.

Thanks.

Bonnie, you can use some qualified expenses on Form 8815, and the remainder on Form 8863. If you open the directions to Form 8815, it indicates that you should not use expenses on line 2 of Form 8815 that you also used on Form 8863. So, you can separate the qualified expenses to get the best outcome. Just don't use the same expenses on both forms.