Jermaine and Kesha are married,file a joint tax return,have AGI of $82,500,and have two children.Devona is beginning her freshman year at State University during Fall 2010,and Arethia is beginning her senior year at Northeast University during Fall 2010 after having completed her junior year during the spring of that year.Both Devona and Arethia are claimed as dependents on their parents' tax return.Devona's qualifying tuition expenses and fees total $4,000 for the fall semester,while Arethia's qualifying tuition expenses and fees total $6,200 for each semester during 2010.Full payment is made for the tuition and related expenses for both children during each semester.The American Opportunity credit available to Jermaine and Kesha for 2010 is:

Question

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Jermaine and Kesha are eligible for the American Opportunity credit for both Devona and Arethia since they are both claimed as dependents on their tax return and they paid for their qualified tuition expenses. The credit is equal to 100% of the first $2,000 of qualified expenses and 25% of the next $2,000, for a maximum credit of $2,500 per eligible student per year. Therefore, Jermaine and Kesha can claim a credit of $2,500 for Devona's fall semester expenses and $2,500 for Arethia's fall semester expenses, for a total of $5,000. They can then claim an additional $2,500 for Arethia's spring semester expenses, bringing the total credit to $7,500. However, since the maximum credit per tax return is $2,500 per eligible student per year, the total credit is capped at $5,000.

Jermaine and Kesha Are Married,file a Joint Tax Return,have AGI