Intuit Academy Tax Practice Exam 2026 – All-in-One Guide for Exam Mastery!

The selected answer is the Child Tax Credit, which is incorrect as the Child Tax Credit is partially refundable under certain conditions. The correct answer is the Lifetime Learning Credit, as it is a non-refundable tax credit.

The Lifetime Learning Credit is designed to help taxpayers with the costs of higher education by reducing their out-of-pocket expenses. However, it is non-refundable, which means it can reduce your tax liability to zero but will not result in a refund if the credit exceeds the amount of tax owed. This aspect is significant for taxpayers to understand, especially when planning education expenses and anticipating their tax outcomes.

In contrast, the Earned Income Credit and the Child Tax Credit have refundable portions that can provide a refund to taxpayers even when they do not owe any taxes, making them distinct from the Lifetime Learning Credit. The Premium Tax Credit is also refundable, aimed at assisting individuals and families with health insurance premiums under the Affordable Care Act. Understanding the nature of these credits helps in accurately planning for tax liabilities and refunds.