Karen, filing as head of household, and her son James and daughter Julia are all in graduate school. James and Julia are not dependents on Karen's return, although they live with her and she pays all of their education expenses. Karen paid $6,000 in qualified tuition expenses for herself in January 2016 for the term starting in January 2016. She also paid $2,500 in qualified tuition expenses for James and another $2,500 for Julia in July 2016 for the terms starting in July 2016. Her adjusted gross income is $66,000. Which of the following is true for tax year 2016?
a) Karen may claim neither the American Opportunity nor the Lifetime Learning Credit.
b) Karen may claim no American Opportunity Credit and $2,000 Lifetime Learning Credit.
c) Karen may claim no American Opportunity Credit and $1,000 Lifetime Learning Credit.
d) Karen may claim $5,000 American Opportunity Credit and $1,000 Lifetime Learning Credit.
Ans: a) Karen may claim neither the American Opportunity nor the Lifetime Learning Credit.
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FIll in the blank with correct word.