American Opportunity Tax Credit Reform Act

American Opportunity Tax Credit Reform Act

This bill amends the Internal Revenue Code, with respect to the American Opportunity Tax Credit, to provide that any credit amount which is attributable to a federal Pell Grant under the Higher Education Act of 1965 shall be reduced by the amount of expenses (other than qualified tuition and related expenses) which are taken into account in determining the cost of attendance at an institution of higher education for the academic period for which the credit amount is being determined. 

The bill also modifies the definition of "qualified scholarship," for purposes of the tax exclusion for such scholarships, to include a federal Pell Grant as a qualified scholarship.