Why did I get a smaller education tax credit than expected, or none at all?

Several things commonly shrink or eliminate the credit. First, income: both the American Opportunity and Lifetime Learning Credits phase out above MAGI limits the IRS sets, and high earners get a reduced credit or none. Second, tax-free money: expenses paid with scholarships, grants, employer assistance, or 529 withdrawals don't count, so if aid covered most of your tuition, little qualified expense remains. Third, the AOTC is only for the first four years of undergrad and requires at least half-time enrollment. Fourth, you must have a Form 1098-T from an eligible institution. Finally, the nonrefundable portion only helps if you owe tax. Review your 1098-T and worksheet carefully. The IRS interactive tax assistant on irs.gov can confirm your eligibility and the exact amount.