What is an eligible educational institution?An eligible educational institution is any college, university, vocational school, or other postsecondary educational institution eligible to participate in a student aid program administered by the U.S. Department of Education. It includes virtually all accredited public, nonprofit, and proprietary (privately owned profit-making) postsecondary institutions. Your educational institution should be able to tell you if it is an eligible educational institution.What if expenses were paid with college loans?You can claim an American opportunity credit for qualified education expenses paid with a loan, even if loan payments are deferred until after graduation. Use the expenses to figure the American opportunity credit for the year in which the expenses are paid, not the year in which the loan is repaid. Treat loan payments sent directly to the educational institution as paid on the date the institution credits the student's account.What if expenses are paid with tax- free aid, such as the Pell Grant?If the grant or scholarship is tax-free (as a Pell grant is) you cannot use the portion of expenses paid by that award to figure the credit. If you had expenses beyond the award amount, use that portion for the credit. Other tax-free aid includes scholarships, fellowships, employer provided educational assistance and veteran’s educational assistance.What is the time frame allowed to claim a college tax credit for 2009?You may claim the credit for expenses paid in 2010 for college classes that began in 2010 or the first three months of 2011. So if you paid in December for the spring semester of - that counts.Can I take the American Opportunity Tax Credit if I already took a tuition and fees deduction?No, you cannot take both the tax credit and deduction for the same student. This would be a double benefit and is not allowed.Should I take a tax credit or tuition and fees deduction?This is not something that CPN can answer; you should discuss which would give you the maximum benefit (paying the lowest amount of taxes) with your tax accountant.