Ok, lots of questions on this so I thought I would start a thread. I train volunteers to prepare taxes for free for LMI families -- including those who are claiming education expenses. I'll give you a brief run-down, based on the assumption that you are a pursuing an MBA (or other advanced degree) and that you are claiming your own personal exemption (your parents aren't claiming you as a dependent).
There are three possible tax benefits for those who are paying graduate expenses: the Lifetime Learning Credit, the tuition and fees deduction, and the Schedule A deduction. We'll start with the LLC.
Lifetime Learning Credit
The LLC can be used to limit your tax liability if you pay qualified education expenses. Given the above assumptions, there isn't much to understanding this credit. First, the credit only applies to qualified expenses. Qualified expenses are necessary for enrollment and paid to the school. Tuition obviously counts, but a parking pass would not. Second, these expenses must be paid with cash or student loans. (In other words, it can't be from scholarships, grants, or paid by your employer. Also, the funds can't be from a pre-tax account, such as a 529.) If your rich grandmother pays your tuition, you still get to claim the credit. Two other rules: you can't be filing as a nonresident alien or filing married filing separately.
This credit phases out for incomes between $45k and $55k for single filers or between $90k and $110k for married filers. The LLC is worth up to $2000 per return, or 20% of the first $10,000 in qualified expenses.
Yeah, I know it doesn't mean much, considering that we're already paying 2 to 5 times that in tuition each year, and considering the phase-outs. But on the other hand, the academic year straddles the calendar year, so we'll be in school during 3 tax years.
See Pub 970 for more info on tax credits or page 224 of Pub 17 for more info. Both publications are available at
https://www.irs.gov.