Credits

Qualified educational expenses would include tuition and required fees, but would not include room and board, insurance, transportation or other personal living or family expenses, medical expenses, supplies or equipment.
the American opportunity tax credit includes expenses for course-related books, supplies and equipment that are not necessarily paid to the educational institution.
The credits are subject to income limitations. The credits are not available for married filing separate returns. Both credits are claimed on IRS Form 8863.
The American Opportunity and Lifetime Learning credits are two federal credits available for qualifying higher education expenses paid to eligible educational institutions.
There may also be similar state credits or deductions available. Generally, the American Opportunity credit is available for the qualified expenses for the first 4 years of post-secondary education leading to a degree.
The Lifetime Learning credit is available for both degree and non-degree courses. This includes undergraduate courses not claimed as a American Opportunity credit, graduate studies, and students acquiring or improving their job skills.

Qualified educational expenses would include tuition and required fees, but would Not include room and board, insurance, transportation or other personal living or family expenses, medical expenses, supplies or equipment.
The credits are subject to income limitations. The credits are not available for married filing separate returns.
Both credits are claimed on IRS Form 8863.

You cannot claim the Lifetime Learning Credit and the American Opportunity credit in the same year for the same student. You may claim each of the credits for a different student in your family.

Any unused Lifetime Learning credit cannot be carried forward to future years.
The phase out for:
married taxpayers is Adjusted Gross Income between $107,000-$127,000. ($104,000-$124,000 in 2012).
single, head of household or qualifying widower(s) filing status taxpayers phase out is between $53,000 and $63,000.
Married filing separately status are not allowed a Lifetime Learning credit.

You cannot take the credit if you are a student. You were a student if during any part of 5 calendar months of the current year you Were enrolled as a full-time student at a school, or Took a full-time, on-farm training course given by a school or a state, county, or local government agency. A school includes technical, trade, and mechanical schools. It does not include on-the-job training courses, correspondence schools, or schools offering courses only through the Internet.

No.You may be able to take the credits if you made energy saving improvements to your Home located in the United States in the current year. A home is where you lived in the current year and can include a house, houseboat, mobile home, cooperative apartment, condominium, and a manufactured home that conforms to Federal Manufactured Home Construction and Safety Standards. Your main home is generally the home where you live most of the time. A temporary absence due to special circumstances, such as illness, education, business, military service, or vacation, will not change your main home.

If you cannot use all of the credit because of the tax liability limit you can carry the unused portion of the credit to the following year. File form 5695 even if you cannot use any of your credit in the current year.

You cannot claim the credit if the person(s) who made the qualified contribution or elective deferral (a) was born after January 1, 1994, (b) is claimed as a dependent on someone else’s 2011 tax return, or (c) was a student.

You are not eligible for the credit if your adjusted gross income exceeds a certain amount. You cannot take the credit if either of the following applies: The amount of AGI on Form 1040, line 38 ; Form 1040A, line 22; or Form 1040NR, line 37, is more than $28,250 ($42,375 if head of household; $56,500 if married filing jointly).