Questions about Form 1098-T?
Has the 2014 Form 1098-T been released?
Heartland/ECSI, on behalf of Concord University issued Form 1098-T electronically for the 2014 tax year on January 31, 2015.
What is the 1098-T form?
The 1098-T form is used by eligible educational institutions to report information about their students to the IRS as required by the Taxpayer Relief Act of 1997. Eligible educational institutions are required to submit the student's name, address, and taxpayer’s identification number (TIN), enrollment and academic status. Beginning with 2003, educational institutions must also report amounts to the IRS pertaining to qualified tuition and related expenses, as well as scholarships and/or grants, taxable or not. A 1098-T form must also be provided to each applicable student. This form is informational only. It serves to alert students that they may be eligible for federal income tax education credits. It should not be considered as tax opinion or advice. While it is a good starting point, the 1098-T, as designed and regulated by the IRS, does not contain all of the information needed to claim a tax credit. There is no IRS requirement that you must claim the tuition and fees deduction or an education credit. Claiming education tax benefits is a voluntary decision for those who may qualify.
Why did I receive a 1098-T and what am I supposed to do with it?
In January of each year, Heartland/ECSI provides an IRS Form 1098-T to all students who had qualified tuition and other related educational expenses billed to them during the previous calendar year. This form is informational only and should not be considered as tax opinion or advice. It serves to alert students that they may be eligible for federal income tax education credits. Receipt of Form 1098-T does not indicate eligibility for the tax credit. NOTE: It is up to each taxpayer to determine eligibility for the credits and how to calculate them.
Did you send a copy of this form to the IRS?
Yes. Section 6050S of the Internal Revenue Code, as enacted by the Taxpayer Relief Act of 1997, requires institutions to file information returns to assist taxpayers and the Internal Revenue Service in determining eligibility for the Hope and Lifetime Learning education tax credits. Forms are mailed at the end of January of each year for the previous tax year.
What educational expenses are considered as qualified tuition and related expenses?
- Graduate and Undergraduate Tuition
- Student fees
- Assessment fees
- Residence Hall charges
- Application fees
- Transcript fees
- Diploma fees
- Textbook costs
For more information about qualified educational expenses please go to: http://www.irs.gov/publications/p17/ch35.html#d0e74760.
Why isn't there an amount in box 1?
The IRS instructs institutions to report either payments received (Box 1) or amounts billed for qualified tuition and related expenses (Box 2) on the 1098-T. Once an institution has selected one of these options, they cannot change reporting methods between calendar years without IRS permission. Concord University reports qualified tuition and related expenses that were billed during the tax year (Box 2) and scholarships and grants; therefore, Box 1 – Payments Received for Qualified Tuition and Related Expenses, will be blank.
What other information do I need to claim the tax credit?
While it is a good starting point, the 1098-T, as designed and regulated by the IRS, does not contain all of the information needed to claim a tax credit. Most of the information needed must come from the student's personal financial records of what the student paid during the calendar year. Additionally, each taxpayer and his or her tax advisor must make the final determination of qualifying expenses.
What are the Hope Credit and the Lifetime Learning Credit and what are allowable tuition and fee tax deductions for each?
For an overview of the Hope Credit, Lifetime Learning Credit, and allowable tuition and fee tax deductions visit http://www.irs.gov/uac/Tax-Benefits-for-Education:-Information-Center. Not all students who pay qualified expenses are eligible for a tax credit.
Chapter 35 of IRS Publication 17 provides a very clear explanation of the eligibility requirements and filing instructions for the Hope Credit and the Lifetime Learning Credit. You can access an electronic copy of this chapter at http://www.irs.gov/publications/p17/ch35.html. The information provided may help you determine if you may be eligible for a tax credit. If you are eligible for both, it will help you decide which to claim. Each student can only claim one of these tax credits per year. You are also prohibited from claiming a tuition and fees deduction and an education tax credit for the same student for the same year. Publication 17 includes a number of useful real-life examples. Publication 970 explains tax benefits for education: http://www.irs.gov/publications/p970/index.html.
What is the American Opportunity Credit?
For more information please visit http://www.irs.gov/publications/p17/ch35.html.
I paid my qualified tuition and related expenses with student loans. Can I still claim a Hope or Lifetime Learning Tax Credit or the Higher Education Tuition and Fees Deduction?
Yes. Loan funds should be considered in the same manner as cash payments when calculating a Hope or the Lifetime Learning Tax Credit or the Higher Education Tuition and Fees Deduction. However, any scholarships, grants, or other non-taxable aid must be deducted from the amount of qualified tuition and related expenses paid. The credit is claimed in the year in which the expenses are paid, not in the year in which the loan is repaid.
If I pay college tuition and fees with a scholarship, can I claim an education credit on Form 8863 for those payments?
No. You cannot claim a credit for the amount of higher education expenses paid for by tax-free scholarships. For more information, please visit the IRS website.
Where can I find out more about educational tax credits and deductions?
To find more information about the tax credits and deductions, please visit our Additional Resources page.
My address listed on the 1098-T has changed. Will this affect me?
No. The address shown on Form 1098-T is irrelevant for IRS income tax filing purposes. The single most important information on the form is your Social Security Number.
How can I get an itemized listing of my financial activity that is on my 1098-T form?
A itemized summary is displayed below the Form 1098-T on MyCU.
What if I still have questions?
If you have additional questions/concerns, please contact the IRS Tax Department at (800) 829-1040.
Note: Please be advised that Concord University is prohibited from providing legal, tax, or accounting advice to students and we are not responsible for any use you make of this information.