Friday, February 17, 2012
What is Form 1098-T?
The form 1098-T is used by the student or whoever pays the qualified tuition or educational expenses to claim a educational tax credits and taxability of scholarships and grants that is filed on IRS Form 1040 or 1040-A. The form will show the student's name, address, social security number and other identifying information. Dollar amounts shown include payments received by the institution, amounts billed, prior year adjustments and scholarships or grants along with related prior year adjustments.
The amounts shown on the 1098-T may differ from the students actual educational expenses. It is important to note that the student can only claim the tax credit for actual tuition or educational expenses paid (qualified tuition, fees and required books and supplies), during the tax year. However, the qualified educational expenses must be reduced by other tax-free educational benefits. If the student is a dependent of another individual making the payments, only that person making such payments can claim the credit.
Posted by Plan For College at 5:35 PM