8863-K: Kentucky Education Tuition Tax Credit (2024)
Kentucky · Kentucky DOR · Used for tax years 2024
Form 8863-K calculates the 2024 Kentucky Education Tuition Tax Credit for qualified undergraduate expenses at eligible Kentucky institutions. It also calculates allowable unused credits from prior years and amounts available to carry forward.
Who files this form
Use Form 8863-K to calculate and claim the 2024 Kentucky Education Tuition Tax Credit, including any allowable unused credit from prior years.
To qualify for the 2024 credit:
- You must be eligible for the federal education credits.
- All expenses claimed must be for undergraduate studies at an eligible educational institution physically located in Kentucky.
- Your Kentucky filing status must be single, married filing separately on a combined return, or married filing a joint return.
All questions in Part I must be answered “Yes.” If any answer is “No,” you do not qualify.
To claim a credit carryforward, you must have completed Form 8863-K for the prior year or years in which the credit arose.
What you'll need
Have these forms and details ready:
- Federal Form 8863: You must attach it. Kentucky Form 8863-K also uses amounts from this federal form.
- Form 740 or Form 740-NP: Use the names shown on page 1 and the tentative tax from line 22.
- Your Social Security number.
- Student details: Each student's name and Social Security number, the Kentucky institution's name and address, and qualified expenses.
- Federal education credit instructions: Use these to determine qualified expenses and whether each student qualifies. Allowable expenses may differ between the two credits.
- Prior-year Forms 8863-K and carryforward information, if applicable: These are needed to determine the allowable unused credit.
How to file
Enclose Form 8863-K with your Kentucky Form 740 or Form 740-NP, and attach federal Form 8863.
Complete Part I to check eligibility, then the applicable credit calculations in Parts II and III. Complete Part V if you have unused credit from prior years, and use Part IV to determine your allowable credit.
Enter the credit from Form 8863-K, line 17, on Form 740 or Form 740-NP, line 23.
Common mistakes
- Claiming the 2024 credit without federal eligibility: The form says you cannot take the credit if you are not eligible for the federal education credits.
- Forgetting federal Form 8863: It must be attached.
- Continuing after a “No” answer in Part I: The form says to stop because you do not qualify.
- Exceeding the Part II expense limit: Do not enter more than $4,000 of qualified expenses for each student in column (c).
- Claiming a carryforward without the required prior-year form: You must have completed Form 8863-K for the relevant prior year or years.
- Not keeping carryforward records: If you have a credit carryforward, keep a copy of the carryforward worksheet or Form 8863-K for future returns.
Questions people ask
Which education credits does Form 8863-K cover?
It covers the American Opportunity Credit and the Lifetime Learning Credit, based on qualified undergraduate education expenses paid to an eligible Kentucky postsecondary institution.
What is the maximum Kentucky credit?
The American Opportunity Credit is limited to 25% of the allowable federal credit, with a maximum of $625 for each qualifying student. The Lifetime Learning Credit is limited to 25% of the allowable federal credit, with a maximum of $500 per return.
Can expenses at an out-of-state institution qualify?
No. The institution attended must be physically located in Kentucky.
Can I carry unused credit forward?
Yes. Unused Kentucky education tuition tax credit can be carried forward for up to five years. You must have completed Form 8863-K for any prior year from which you claim a carryforward. Part IV, line 18, calculates unused credit from 2024 to carry forward to 2025.