The American Opportunity Tax Credit is an education tax credit from the US federal government that plays a crucial role in helping parents and students with the cost of college. For the tax year 2025, the maximum credit is $2,500.
It can be claimed with the federal tax return by parents and the student; this tax credit is partially refunded. If you owe any taxes, AOTC can be reduced significantly, and if the amount you owe is smaller than the tax credit, you can get a refund.
By claiming this tax credit, you can get a refund of up to $1,000. Here, we have shared all you need to know about getting the AOTC refund. Read this article to check if you are eligible to get it, how much you can get, and much more.
| Credit Name | American Opportunity Tax Credit (AOTC) |
| Maximum Credit | Up to $2,500 per student |
| Refundable Amount | Up to $1,000 can be refunded |
| Eligible Student | Undergraduate student in a recognized college |
| Eligible Expenses | Tuition, books, and course materials |
| Income Limit (Full Credit) | $80,000 (single), $160,000 (married) |
| Phase-Out Limit | $90,000 (single), $180,000 (married) |
| Who Can Claim | Parents or the student |
| Tax Year Covered | 2025 (Refund in 2026) |
| Refund Time | January–February 2026 (e-filing faster) |
Who is eligible to claim the AOTC in 2026?
To claim the American opportunity tax credit in 2026 in order to refund or reduce tax liability, it is mandatory that you meet the following requirements:
- You must be pursuing a four-year undergraduate course from a college or university recognized by the Department of Education.
- The student must not have a felony drug conviction, and you must have paid for the tuition, books, and course materials.
To get the maximum AOTC, it is mandatory that your adjusted gross income as a single and married filing jointly shouldn’t be above $80,000 and $160,000, respectively.
How much can be received by claiming AOTC in 2026?
By claiming the AOTC for the tax year 2025 with the federal refund, one can reduce the tax liability up to $2,500, and if the amount you owe the government is below the tax credit, the maximum you can get as a refund is $1,000.
Note that if your AGI is above the threshold, your credit amount is reduced gradually, and the refundable portion is also reduced. The maximum age you can claim a little portion of the AOTC is $90,000 and $180,000 for singles and couples.
The reduction formula is Full AOTC × (Upper Limit − Claimant’s AGI) ÷ $10,000. Suppose that as a single your AGI is $85,000; your benefit will be reduced by ($2,500 × ($90,000 – $85,000) ÷ 10,000), i.e., $1,250.
In the above case scenario, you can claim the AOTC of ($2,500 – $1,250), i.e., $1,250, and the maximum refund you can get is only $500. The refund you can get by claiming this tax credit depends on your filing type, adjusted gross income, and tax liability.
When to expect the 2026 AOTC refund?
The AOTC refund for the tax year 2025 will be received by you based on your filing type and time. If you file electronically in the initial stage, there is a high speculation that the direct deposit refund will be received by you by late January 2026.
In case of filling on paper, you have to wait at least six to seven weeks to receive the refund direct deposit. After electronically filing, you have to wait at least 3 weeks to get the refund in your bank account; an error may delay it by a week or even more.
The filing process is likely to start in early January 2026, but the processing will start once the 2026 tax season officially begins. After filing, you will be able to check the refund status through the Where’s My Refund? tool 24 hours after e-filing and 4 weeks after on-paper filing.
Disclaimer: AOTC refund information for 2026 may vary. Refer to official IRS guidelines for exact rules.