I:14-50 American Opportunity Tax Credit and Lifetime Learning Credit. Lou and Stella North are married, file a joint return, and have two dependent children in college, Phil and Jaci.

Phil attends a State University in a neighboring state, and Jaci attends a State University in their home state. Neither receives any type of financial assistance. The Norths’ modified AGI in 2022 is $122,000. The children’s classifications and expenses are as follows:

Spring Semester 2022

(paid in January 2022)

Fall Semester 2022

(paid in July 2022)

Phil: Senior Master’s candidate Tuition $7,500 $8,000 Laboratory fees 500 500 Student activity fees 100 100 Course materials (books) 400 450 Room and board 3,200 3,200 Jaci: Sophomore Junior Tuition $1,600 $1,750 Student activity fees 100 100 Course materials (books) 250 300 Room and board 3,500 3,700

a. Compute any education credits that the Norths may claim in 2022.

b. How would your answer in Part a change if Phil received an academic scholarship of

$3,000 (excluded from gross income) for each semester?

c. How would your answer in Part a change if Lou and Stella’s modified AGI was

$175,000?

d. How would your answer in Part a change if Phil had been a junior during Spring semester and a senior during Fall semester?