IRS Update for Form 8863: Education Tax Credits

Tax News

IRS Update 2/8: 

Good News for your Valentine’s day and your tax refund!  The IRS announced today that they are now able to process tax returns that contain form 8863 with Education Credits beginning February 14th.  Form 8863 is used to claim two higher education credits — the American Opportunity Tax Credit and the Lifetime Learning Credit.

Read the full IRS update

The IRS announced today that they will not be able to process tax returns with Form 8863 until mid-February.  This is a delay that will impact all tax preparation methods.

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What is Form 8863?

Form 8863 is the form that is used to claim the American Opportunity Credit and the Lifetime Learning Credit.

American Opportunity Credit:  The American Opportunity Tax Credit is offered to students who pay qualified tuition (and aren’t claimed as dependents elsewhere), as well as to parents who pay expenses for their dependent students or themselves.  This tax credit allows you to claim up to $2,500 per student. The full credit is available for individuals with a MAGI(Modified Adjusted Gross Income) of $80,000 or less, $160,000 for married filing jointly. It is 40% refundable, meaning that you can get up to $1,000 back even if you don’t owe taxes.

Lifetime Learning Credit:  The Lifetime Learning Credit a perk available to you if you paid qualified college expenses.  Rather than limiting your ability to get tax credits for education expenses for the first four years of college, it’s possible to use the Lifetime Learning Credit to offset your expenses even in graduate or professional school. As long as the educational institution is qualified, undergraduate or beyond, you can qualify for up to $2,000 in tax credits for your expenses. It’s figured on 20% of your tuition and fees, up to the first $10,000. There is a phase out as you reach certain income levels. Parents can claim this for dependent students.

Can I still File?

Yes!!!  TurboTax is up to date with all the latest tax law changes, including changes to the American Opportunity Credit and Lifetime Learning Credit, so you can be confident that you are getting every deduction and credit you deserve on your tax return.  We recommend that you file now with TurboTax, so you will be at the front of the line for your refund when the IRS begins to process these returns. Returns will be submitted on a first in, first out basis.  For the fastest refund possible, make sure you e-file and select direct deposit.

Last year, the IRS issued  9 out of 10 refunds in 21 days or less  and expects the same results this year.  Once your return is accepted by the IRS, you can track the status of your return you can login in to your MyTurboTax account at anytime.

Comments (365) Leave your comment

  1. Hello! I filed my taxes about two and a half weeks ago and I just received my refund in my bank account today. However, my $1,000 American Opportunity Tax Credit was not included in the refund. I’m rather confused and slightly frustrated by this. Is the credit refunded separately and at a later date?

  2. My Story, I filed my taxes in the first week of February. Got a letter couple weeks later about the education credits. So I sent it in twice, once fax, once certified email. I only got a partial refund of 380, and not for my education credits. I have been calling the IRS the past 2 months about it, and each time the answer is wait 2-3 weeks and call us back. It has been over 4 months and I still do not have my full refund. This is ridiculous.

  3. I filed March 21st. It was accepted March 22nd. I reviewed a letter the 29th that if I haven’t received my refund within 60 days to contact them with the number provided on the letter. I am entirely TOO upset with this process. My expected return date was the 11th of April, but due to this stupid letter, I may not see my refund until the 28th of MAY. I am a student and this tax credit seems too troublesome for its worth if ALL of the students using the 8863 form is getting hit with extended processing times.

    1. H&R block was aware of the delays for the education credit, and should have informed their clients. I decided to wait to file my taxes to avoid all the confusion, whatever bill I had or whoever I owed just had to wait

  4. UPDATED INFORMATION!!

    So I just got off the phone with the IRS and I ask how long could this take the rep told me it could take 4-8 weeks counting from march 15th so mid april or the begining of may smh!!!

    I am soooo upset i am not going to even express it..

    1. HI, Just to let you and others know, this is what happened to me and I think will be happening to everyone else eventually as this IRS glitch gets cleared out. I filed my taxes on 2/5 and of course got no refund due to delay. On 3/16 I got an IRS letter but I was so busy and in a hurry that forgot to read it! Then on 3/19 I checked on my refund status and saw the deposit would be made on 3/20 and sure enough it was, so I was happy to get the refund. Then I dug up the letter and read that the IRS was asking I send them ONLY my answers for questions 25 & 26 of the 8863 form. ( I too had done my taxes online on H&R block and like many others I saw the answers were indeed checked off.) Since I received the letter first it didn’t make sense that I would get the refund without responding, but I did! So I assumed the IRS somehow discovered that my answers were indeed submitted. I decided to check with the accountant I used last year and he told me I could ignore it now that I got the refund and wait to see if the IRS requests it again or go ahead and respond anyway. He didn’t know why the IRS would request my answers and then pay the refund but he too thought they must have figured out the mistake. He told me not to worry about it. I told him I was now afraid to respond and have the IRS take the refund back and he told me they would not try to withdraw it but would instead send me a bill if the refund or part of it was in error. But he said it was not anything to worry about. He didn’t think it was a big issue to be afraid of the IRS, not responding at this point, and to just wait and see, or go ahead and respond, but that it seemed to be an IRS error. I now agree, given that I’ve discovered that this seems to have been the glitch the IRS had with all who claimed the college credit. Then on 3/22 I received a letter from H&R Block informing me of the issue. So I’m just going to take my accountant’s advice and wait and see if I hear from the IRS again, but I don’t think I will, given that they sent my refund and its now obvious the error was theirs. I too was informed by the letter that the refund would take 4-8 weeks, but it came a week later. So there’s hope you might be getting yours sooner.

    2. I filed on January 26th, IRS accepted on February 14th. I also received an email on March 15th saying it will take an additional 4-6 weeks. I filed in-store at H&R block. So I’m in the same boat. VERY frustrating!

    1. UPDATED INFORMATION!!

      So I just got off the phone with the IRS and I ask how long could this take the rep told me it could take 4-8 weeks counting from march 15th so mid april or the begining of may smh!!!

  5. I filed my taxes through H&R Block on 1/21/13, I was accepted 1/30/13. I checked for updates through the month of February on WMR. After several weeks with no update I contacted HR block reps – 3 who told me refund was processing fine, there were no errors and to expect my refund on 2/21 which never happened. I reached out to the IRS who informed me that I was in error resolution and to wait on a letter. I received the letter 3/4 and was informed that lines 25 & 26 on my form 8863 was not populated. I checked back on the HR block at my PDF which shows that it was filled out. I find out later by speaking to another IRS rep that this is a huge issue this year w/ HR block they did not populate the No answer for 25 &26 which caused an error and the delays. It is going to take 6-8 weeks from the point they receive my corrected form 8863 to receive my refund. I have since spoken to 3 HR block representatives in their escalation center who still will not address or acknowledge that this is an HR block error and refuse to accept responsibility even though this is now in the major news. H&R block is negligent for not responding to their clients earlier on to let them know that they could be affected by these delays , they did not make an action to correct these issues until after 2/22 which was after the IRS started processing the form 8863 on 2/14. H&R blocks software error has affected so many people from receiving their hard earned money AND it is causing delays for applying for 2013 FAFSA. This is not right and HR block should be held responsible. Innocent people are being affected due to their misguidance and negligence. Pleas sign this petition if you agree!

    http://wh.gov/ocWE

    1. I filed with H&R Block on 01/25/2013 and my return was accepted on 02/14/2013. I contacted the IRS last night and they reviewed my return and told me that I would not receive a letter. When I checked WMR this morning my return was approved and scheduled for 03/18/2013. Hopefully, they are getting everything corrected.

    2. The same thing happened to me, give or take. I never received a letter stating 8863 was not completed. They had just processed my return after 4 weeks and reduced my refund. When I spoke with the IRS, and being told it was my fault and I was deducting too much and where did I get my information from, and crash coursed myself on these forms, 8863 especially, she finally said oh yes, 25 &26 were not answered. I was bounced back and forth from H&R to IRS, told to do an amendment because that was “all that could be done”. I gave it one more shot with the IRS and whoever the angel was on the line, she said yes those questions are not answered, what are the correct answers, fixed it on their end, and bam… told me 1-3 weeks for a check since they cannot direct deposit twice. I would push, and this goes for everyone having this problem, to get the IRS to simply fix it on their end and save themselves time and money, but more importantly, getting it corrected faster on your end. I am still waiting on mine, so I can’t say it’s all said and done, but I finally got some results. Good luck to all!

  6. I filed with H & R BLOCK feb 4th the irs accpeted my retun on the 15th… and still nothing has happend the staus is the same.. I called today and the IRS said they are sending me a 8863 Form and I have to send it back has anyone fiilled out this form because it dosent sound like it??? or does you tax preparer send it out im confused PLEASE HELP!

    1. I did mine with H&R Block and the form was completed in my return. However, the IRS kept kicking it back as error. It finally went through but now over 21 days. I called and they said it can take an additional 2 weeks.

    2. I am getting the same thing. I just called the IRS and they told me I would be getting a notice… Have you recieved yours yet?

      1. i called them last week they told me the same thing… what questions are on the notice and they wont even tell me. nothing about i dont owe anything so i dont know whats the hold up!

    3. Same here… IRS stated that LOTS of tax prep people had submited the 2012 version of the form…have to fill it out and return the new version could be a 4 week delay…Call HR block and scream like i did and get your fees waived

      1. I called HR block and screamed several times. Even threatened to take them to small claims court to get my fees credited back. They still keep saying it wasn’t there fault and they dont care.

      2. I tried calling H&R Block to get my fees waved as well.. They said “It’s not our fault” so when I explained to them how it was and how everyone knows it is.. they still said “You’re not getting your money back” and hung up. Nice people. Still no refund and it’s been over 2 months since I filed, 6 weeks since I’ve been accepted.

    4. I received the IRS notice on Saturday 3.09.13 stating that lines 25 & 26 were not checked. When I looked at my copy of form 8863, they were checked. I called H&R Block & they knew all about this & the millions of taxpayers whom this effects. The form was completed correctly but the IRS new software interface, didn’t read the check marks. I have been waiting since JAN 16th for my refund. Anyways, H&R Block was notified by the IRS about this error & all of our returns have been resubmitted & we are to ignore the letter. I am going to call the IRS today to confirm all of this information. I am still upset that H&R Block knew this weeks ago & didn’t email me about this problem. If you call H&R block, give them the letter reference & they already have a copy of it from the IRS & can give you further instructions. H&R Block told me not to submit by fax a new copy of Form 8863 as it has been cleared up for everyone effected. They even read the letter from the IRS to me to confirm.

      1. I had the exact same issue and H&R block told me as well to just ignore the letter – but this is not correct. I listened to IRS, printed out the entire 8863 form and refilled it out and faxed to the fax number on the letter. I did this on Friday, March 8. My correspondance was received the same day and my return was put back into regular processing by Monday, March 11. I now have a deposit date for March 20. If you ignore this letter and the 20 days pass, you could lose your education credit. I would not listen to H & R block and I would take matters into my own hands and fax in the form, Just a suggestion. The IRS told me you have to respond. I don’t know why H & R Block is saying not to respond but I have definitely decided not to use them again.

    5. I called the IRS yesterday and pretty much got the same information but they stated to allow an additional 4 weeks.

    6. I filed with h&r block as well ….my refund was accepted on Feb 15….but due to error because of the 8863, my refund was delayed..Now they told me that i have to wait additional 21 days, which i am definitely unwilling to accept. i have contacted the IRS, than i have contatcted the TAx Advocate, who is supposed to help speed up the process of getting my money back, and I have also contacted the congressman in my state who then send a request for my case to be processed faster… I would suggest everyone to try this… The problem is i really need my money …have bills that are due tomorrow and was really couting on my refund….which doen’t seem to be comming soon.
      Last year…because of an error on my address and numerous calls to the IRS and congressman…it took the IRS 6 months to fix this simple issue …..I AM NOT LETTING THIS HAPPEN AGAIN!!!!!!!
      One thing that bugs me the most is when we owe them money ….they take it so fast…no questions asked ….and we have to meet the deadline or there are penalties….What HAPPENED TO OUR DEADLINE, WHY CAN’T WE PENALIZE THEM FOR NOT PAYING IN TIME !!!!???????

    1. Yes I finally received my DD today and it was all accounted for. Thank God this waiting game is over for me, those still waiting don’t give up it is coming!!!!

  7. I also am one of the earlier filets and on Saturday the IRS site updated stating my DD date was scheduled for 2/26/2013… ALL SMILES :-)

  8. Okay, so I was one of the early filers who filed on Jan. 14 with Form-8863 and got accepted on Jan. 24. After calling the IRS several times this week and hearing different things from different agents, the last agent I spoke to yesterday let me know that my refund had been approved and the direct deposit date was Feb. 27. I had been told by previous agents that my return got accepted on the 20th of February, then the 19th of February. Finally, the last agent I spoke to on Feb. 22 at the end of the day told me that my return had been accepted on Jan. 24, but did not go through for processing until Feb. 14 due to Form-8863 and my direct deposit date is Feb. 27. Also, the agent let me know that he will inform his manager that “Where’s my Refund” had not given me the updated information. Today, “Where’s my Refund” also states that my direct deposit date is Feb. 27. It almost seems as if you have to call the IRS to get your return moving! The number I kept calling was 1-800-829-0582 ext. 462. I will definitely let you guys know if and when I actually see my refund in my account so that you can also have a good idea about when you can expect your own refund. It has been a stressful month and I thank everyone who was considerate enough to share their information with the rest us us! Good luck to everyone who have yet to get a direct deposit date, I am sure it is coming soon!

    1. im calling them now I filed the 21st of jan accepted the 14th of feb still saying processing on wmr. people that filed and got accepted after me are getting returns getting a little be ridiclious I hope i dont get someone who is all snotty….seems like the IRS has forgotten who pays there wages!

      1. Jeremiah
        Did you talk to anyone at IRS? I called last night and was told it is being processed. I filed on 01-26 I was told to be patient that it is still being processed. I think I have been patient !!!

      2. I had the education credit and was accepted on the 14th. Mine was deposited into the bank that turbo tax uses and it was short. I called the irs and they said it should have not been short. It was short $469 less than what wmr said. Has anyone else had this problem? Irs said its between me and the third party…

      3. Mine was accepted on 2-14 I filed on 1-26. I still am showing processing and was told last evening by IRS it is being processed. So I won’t know if mine is not the amt I am getting ntil I recv. my my refnd. Did yo get a email from the bank letting yo know it was recv’d?

  9. Update: I filed on Jan. 19th and was accepted on the 25th but had to wait til feb 14th b/c of education credits.. I just checked on WMR and finally it shows that I have a DDD od Feb. 27th!!! YAY this has just been to long and so crazy this year!!

    1. I was accepted on the 24th of January, had to wait til the 14th for processing, and now my update through WMR finally gives me the Approved and a DD of Feb. 27th as well. This surely has been a kick in the behind for those of us who tried to get a head start on this years tax season. I just thank God I finally have a DD date!!!!

  10. I filed on Jan 30th, accepted on Feb 14th (due to form 8863) and just received notice on WMR that my refund was approved and will be sent to my bank account on Feb 27th….

  11. ok so now mine posted a tax topic? I click on it and it says to different options on getting your money? Thought this was already done when i filed?

  12. I filled early got accepted on Jan 25 n the irs website is still saying processing I don’t have the orange bars anymore either I have an education credit

      1. Hi I was just worrying how did you get your date because mine was accepted on the 26th and accepted again on the 14th and mines still stated your refund is being processed…

      2. So, I filed on Jan. 19th and was accepted on 1/25 and it couldn’t process until 2/14, but I still get the same message of they are still processing and a date will be provided when available, but no refund direct deposit date. So how in the world are you getting a deposit date now and I filed and was accepted before you did yours? I just don’t understand this…

      3. It doesn’t matter if you filed earlier than someone else. Everyone that had this form got accepted the same day. I did find that most people that used this form this year errored and are now likely to have to wait an addition 6 weeks until it all gets sorted out. I got accepted the same day as everyone else, 2-14-13, I did get an approval message on WMR that I have a DD of 2-25-13

    1. yeah good luck to everyone ,,I talked to the IRS today and people who filed like me or most of them got errored and put on suspend 45 days from Jan 30th! I was accepted on 1/26/13 ..I guess so much for filing before Feb again!

    2. I filed my taxes 1/21 with education credits and was notified by tt that I was accepted on 1/28. Still no DD date and now my bars are missing from the IRS site just states DD date will be provided when avaliable. I was able to speak with a rep yesterday at the IRS (877)829-1040 advised me to disregard acceptance of 1/28 and must start my 21 days from the 14th of Feburary. My co worker however received a DD date this morning of 2/25/13

    3. No I efiled on the 16th of Jan and it was accepted on the 24th of Jan but couldnt be processed til the 14th of Feb due to educational credits and is still processing and this is very frustrating

    4. Ok I have an update for you, I just got off the phone with IRS, I was told even though they say processing of forms 8863 began on 2/14, it actually has not. I was told to wait 21 days from the 2/14 to receive refund. The representative also said to count the weekends in this 21 day count. Finally she told me that DD are made everyday of the week now except on weekends. I hope this helps it helped give me an idea of what to expect.

    5. If this helps i was given a date of the 25th but yesterday (saturday 23rd) i recieved my refund DD into my account. Great news except it was off by about 100.00 . Not sure why. Anyone else get theres yet? Was the amount off?

      1. I filed on 1/25/13 and got excepted on 2/7/13 and it was approved in 2/22/13 and will be deposited into my account on 2/27/13 I was getting stressed out waiting so long but it finally got the results on my Taxes

  13. I filed early but wasn’t accepteduntil feb 14th due to form 8863 delay. Still in processing status. Has anyone that filed that day recieved a dd date?

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