To enter your education expenses, go to the College Tuition Expenses (Form 1098-T) screen and enter the education expenses for you, your spouse, and your dependents and the software will automatically calculate which education credit or education deduction gives you the largest refund.
The American Opportunity Credit is a new credit that expands and replaces the Hope Credit. The American Opportunity Credit can be claimed for education expenses the first four years of college and post-secondary education. Qualified tuition and related expenses has been expanded to include course materials expenses such as books, supplies and equipment needed for a course of study.
The American Opportunity Credit gives a larger credit than the old Hope Credit and if your income is low enough that you do not have any tax, then part of the American Opportunity Credit can be refundable. The American Opportunity Credit is almost always the best education credit to take if you qualify to take it.