 Let's look at an example. Example number one, Jackson is a sophomore in University V's degree program in dentistry. This year, in addition to tuition, Jackson is required to pay a fee to the university for the rental of dental equipment that will be used in this program. Because the equipment rental fee must be paid to the University V for enrollment and attendance, the equipment rental fee is a qualified education expense. So note that we saw a similar example, I believe, in the American Opportunity Credit situation, but here there's a key to it in that it were required to pay for the rental equipment basically to the university, right? It's not like we bought the rental equipment somewhere else and we just bought, we have more leeway to buy it wherever we want. We basically had to buy it as part of the program in essence paying the university for the rental equipment for the lifetime learning credit because it's a bit more restrictive. Example two, Donna and Charles, both first year students at College W are required to have certain books and other reading materials to use in their mandatory first year classes. The college has no policy about how students should obtain these materials, but any student who purchases them from College W's bookstore will receive a bill directly from the college. Charles bought the books from a friend so what was paid for them isn't a qualified education expense. So you need the books in order to be taken to classes because those are the materials for the classes, but they don't mandate where you're gonna buy the books from, they offer them at the bookstore, but in this case Charles bought them from a friend and so they're not gonna be something that would be deductible or included as the expenses in order to calculate the credit whereas in the American Opportunity Credit they may have been an include-able item. Donna bought the books at College W's bookstore. Although Donna paid College W directly for the first year books and materials, the payment isn't qualified expenses because the books and materials aren't required. So she even bought them from the bookstore, but note because the college is saying, hey look, we have the bookstore where you can buy the books, but you're not required to buy the books and materials directly from the educational institution. So you aren't required to be purchased from College W for enrollment or attendance at the institution. Therefore you may not be allowed the expenses to calculate the credit in those cases either and in the American Opportunity Situation I believe both of those situations would be allowable expenses. Both of you paid the friend no matter how you paid for the books because the books are necessary in order for the qualified or required materials of the course. All right, example three, when Marcy enrolls at College X for freshman year, a separate student activity fee is added to the tuition have to be paid. So this activity fee is required of all students and is used solely to fund on-campus organizations and activities run by students such as the student newspaper and student government. No portion of the fee covers personal expenses. Although labeled as a student activity fee, the fee is required for Marcy's enrollment and attendance at College X. Therefore it is a qualified expense. In other words, this isn't an option here. So you have to pay the fee. So you would, otherwise you're not, you're not, you're not moving forward. So you would think that would be something that you would have that would be includeable as an expense to calculate the lifetime learning credits as of course it would. Also you would expect on the American Opportunity Credit. So when we get to these expenses, do they qualify for the expenses? That's when the American Opportunity Credit is more broad and you would think that the lifetime learning situations have a more narrow number of types of expenses that might qualify any expenses that qualify for the lifetime learning. You would think that they would also qualify for the more expansive American Opportunity Credit. However, the American Opportunity Credit, in order to qualify to take the credit at all is more restrictive with the four year restriction and that kind of stuff. Whereas the lifetime learning credit is more broad with the overall just qualifications to be able to take the credit. Okay, no double benefit allowed. You can't do any of the following. Deduct higher education expenses on your income tax return as for example, and a business expense and also claim lifetime learning credit based on those same expenses. You can't deduct it like on a schedule C as a business expense and get the lifetime learning credit because you would be double dipping in that case. So claim a lifetime learning credit for any student and use any of that student's expenses in figuring your American Opportunity Credit. So you can't use the same expenses to be taking two credits, two different credits. Claim a lifetime learning credit based on the same expenses used to figure the tax free portion of a distribution from a Coverdale Education Saving Account, an ESA or Qualified Tuition Program, QTP, C Coverdale with American Opportunity and Lifetime Learning Credits in Chapter 6 and Coordination with American Opportunity and Lifetime Learning Credits in Chapter 7. Claim a credit based on qualified education expenses paid with tax free educational assistance such as scholarship, grant or assistance provided by an employer. So in those cases, you already got a tax benefit because you might have got this money and you didn't have to include it in income. It would, in other words, normally be income. And if you don't have to include it in income, you basically kind of got a deduction already. And therefore, if you took the credit, you would be once again double dipping. So adjustments to qualified education expenses. For each student, reduce the qualified education expenses paid by or on behalf of that student under the following rules. The result is the amount of adjusted qualified education expenses for each student. Tax free educational assistance. So this is gonna be similar to situations in the American Opportunity Credit at this point now. So for tax free educational assistance received in 2022, reduce the qualified educational expenses for each academic period by the amount of tax free educational assistance allocable to that academic period. See academic period earlier. So some tax free educational assistance received after 2022 may be treated as a refund of qualified education expenses paid in 2022. This tax free educational assistance is any tax free educational assistance received by you or anyone else after 2022 for qualified education expenses paid on behalf of a student in 2022 or attributable to the enrollment at an eligible educational institution during 2022. If this tax free educational assistance is received after 2022, but before you file your 2022 income tax return, see refunds. Well, we may talk about this a little bit in more detail. We saw a similar situation in the American Opportunity Credit. You could see refunds received after 2022, but before your income tax return is filed and so on and so forth. In other words, if you get a refund, you took courses and you dropped out of the course or whatever and you dropped out before the date. So they're going to give you a refund. If they give you the refund in the same year of 2022, then you'd have to reduce your expenses by the amount that you got the refund. That's pretty straightforward. But what if you got the refund in 2023? Well, if you got the refund in 2023, if you hadn't yet filed your 2022 tax return, you would think you could still reduce your 2022 tax return by the refund. But if you got your refund in 2023 for the expenses you paid in 2022 after you filed the taxes and you included the expenses in 2022, then what are you going to do? Well, you can amend the 2022 return, but that's kind of a messy situation. You might be able to, if you're claiming the lifetime learning credit again in 2023, you might be able to adjust the expenses in that year. That would seem rational or reasonable. If you're not claiming the educational expense, you might have to recapture some of the credit you got in the prior year. It would be the general idea. Okay.