The term “qualified tuition and related expenses” for the Lifetime Learning Credit are qualified costs of any course of instruction at an eligible educational institution even if the student is enrolled on a less-than-full-time basis. Also, eligible courses include those that enable the individual to acquire or improve job skills rather than obtain a degree.

The term “qualified tuition and related expenses” are out-of-pocket costs for tuition and fees required for the enrollment or attendance of an eligible student at an eligible educational institution. 

Charges and fees associated with books, supplies, and equipment will qualify only if the fee must be paid to the facility as a condition of enrollment. In addition expenses for qualified course material may also be used for the credit. 

Cost associated with room and board, insurance, medical expenses, transportation and similar personal living, or family expenses are not qualified tuition and related expenses. The same goes for expenses for sports, games, hobbies, or any noncredit course unless this education is part of the student's degree programs.

When a student pays a comprehensive fee or bundled fee a reasonable allocation must be made to personal expenses by the facility to determine the nonqualified portion of the fee.