Reference no: EM132713651

Question - Geoffrey was age 23 on 12/31/19. He was a full-time student and completed his 4th year of college in May of 2019. His Spring semester was paid for in December of the prior year and credit on those expenses has been claimed on the prior year's return. After graduation, he was unable to find employment, so he moved back in with his parents and entered graduate school in the fall of 2019. Geoffrey's parents are claiming him as a dependent on their tax return, and they had an AGI of $57,000. Geoffrey received a 1098-T from the college with Box 9 checked (graduate student).

Required - Which of the following statements is correct?

a. Geoffrey's parents will claim him as a dependent and are eligible to take an American Opportunity Credit. This answer is incorrect. Geoffrey's parents cannot take an American Opportunity Credit since "graduate student" was checked in Box 9 of the 1098-T.

b. Geoffrey's parents will claim him as a dependent and may take an American Opportunity Credit for the expenses for Geoffrey's 4th year in college and take a Lifetime Learning Credit for Geoffrey's graduate school expenses in 2019.

c. Geoffrey's parents will claim him as a dependent and are eligible to take a Lifetime Learning Credit.

d. Geoffrey's parents will claim him as a dependent but are ineligible to claim either an American Opportunity Credit or Lifetime Learning Credit for 2019.