University of Illinois Extension

Explanation of Terms

Eligible institution

Definitions of eligible institutions vary for different tax breaks. Generally, they are post-secondary educational institutions eligible to participate in the federal student loan program, but may include others.

Eligible student

The qualifications required to be an eligible student vary by tax break. All require that the student be enrolled at an eligible educational institution.  Some require that the student attend at least half-time. The Hope Credit requires that the student have no convictions for possession or distribution of a controlled substance. To check the definition of an eligible student for a particular tax break, see Tax Benefits for Education, IRS Publication 970 (http://www.irs.gov/formspubs).  

Half-time

For at least one academic period beginning during the tax year, the student must take at least one-half the normal full-time course load for the course of study being pursued.

Modified AGI

Several tax breaks are available only to those taxpayers whose modified adjusted gross income (AGI) is under certain limits. Adjustments to AGI vary with the individual tax break. The modified AGI may require adding foreign income and other amounts not normally taxed, including some other education tax breaks.

Dependent

A dependent is an individual whom you may claim on your income tax.

Qualified higher education expenses

Tuition and fees are included in qualified expenses. Some tax breaks may allow books and supplies to be included. Expenses for room and board are allowed by some tax breaks, usually for students who are enrolled on at least a half-time basis. To qualify as qualified higher education expenses, the educational institution may also be required to be "eligible.” (See “Eligible institution,” above.)