Yes. If the tax credits you want to claim are based on your education expenses, you’ll need to subtract your VA education benefit payments from your total education expenses. These are the payments that go directly to you—not to your college.

Example: You get these 2 VA education benefits:

• $1,200 a month in a VA basic housing allowance that we deposit into your checking account, and
• A $3,500 tuition payment that we pay directly to your college

If you paid $5,000 in deductible education expenses, you can claim the $3,500 that we paid to your college. But you must subtract the $1,200 basic housing allowance that we paid you directly. So you can claim a total of $3,800 in education expenses.