8863-K: Kentucky Education Tuition Tax Credit (2025)
Kentucky · Kentucky DOR · Used for tax years 2025
Form 8863-K calculates the 2025 Kentucky Education Tuition Tax Credit for qualified undergraduate expenses at eligible Kentucky institutions. It also calculates allowable unused credits carried forward from prior years and amounts to carry forward to 2026. Enclose it with Form 74
Who files this form
Use Form 8863-K to calculate and claim the 2025 Kentucky Education Tuition Tax Credit, including any allowable unused credit from prior years.
To qualify for the 2025 credit:
- You must be eligible for the federal education credits.
- All claimed expenses 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.” To claim a prior-year credit carryforward, you must have completed Form 8863-K for the year in which that credit arose.
What you'll need
Have these forms and details available:
- Federal Form 8863. You must attach it.
- Kentucky Form 740 or Form 740-NP, including the names shown on page 1 and tentative tax on line 22.
- Your Social Security number.
- Each student’s name and Social Security number, the Kentucky institution’s name and address, and qualified education expenses.
- Prior-year Forms 8863-K or carryforward records if claiming unused credits.
Use the federal instructions to determine qualified expenses and whether each student qualifies. Allowable expenses may differ between the two credits.
How to file
- Complete Part I to check your qualifications.
- Complete Part II for the American Opportunity Credit or Part III for the Lifetime Learning Credit, as applicable.
- Complete Part V if you have unused credits from prior years, then use Part IV to calculate your allowable credit.
- Enter the amount from Form 8863-K, line 17, on Form 740 or Form 740-NP, line 23.
- Enclose Form 8863-K with Form 740 or Form 740-NP and attach federal Form 8863.
The supplied text does not provide a mailing address or e-filing directions.
Common mistakes
- Claiming the credit when you do not qualify. Stop if you answer “No” to any Part I question. You cannot take the 2025 credit if you are not eligible for federal education credits.
- Leaving out federal Form 8863. It must be attached.
- Entering too much in Part II. Do not enter more than $4,000 of qualified expenses per student in column (c).
- Ignoring blank federal credit lines. If federal Form 8863, line 6, is blank, enter zero on Kentucky line 3; you cannot take an American Opportunity Credit. If federal line 17 is blank, enter zero on Kentucky line 9; you cannot take a Lifetime Learning Credit.
- Failing to keep carryforward records. Keep a copy of the carryforward worksheet or Form 8863-K for future returns. You must have completed the prior-year form to claim an allowable carryforward.
Questions people ask
Which education credits does this form cover?
It covers the American Opportunity Credit and the Lifetime Learning Credit for qualified undergraduate education expenses paid to eligible Kentucky institutions.
How much is the Kentucky credit?
The American Opportunity Credit is limited to 25% of the allowable federal credit, with a maximum of $625 per qualifying student. The Lifetime Learning Credit is limited to 25% of the allowable federal credit, with a maximum of $500 per return. Part IV determines the amount you can use for 2025.
Does a school outside Kentucky qualify?
No. The institution attended must be physically located in Kentucky and eligible to participate in a student aid program administered by the Department of Education.
Can I carry unused credits forward?
Yes. Unused Kentucky education tuition tax credits can be carried forward for up to five years. Complete Part V for prior-year credits. Record unused credit from 2025 to 2026 on Part IV, line 18, and line E of the 2025 Carryforward Worksheet.