My husband attended college for one semester in January 2016. I was going through the deductions and credits section, which I thought was supposed to help REDUCE tax liability and ideally increase refund potential. The 1098-T provides information on both a "billed" amount in box 2 and a "scholarships and grants" amount listed in box 5. The scholarships and grants amount is higher than the billed amount. When all information is entered, the result is actually a decrease in refund. Given this is the deductions and credits section, can I opt to not attempt this education credit / deduction and not report any of the information from the 1098-T? When entered, my refund is negatively effected. Is reporting 1098-T info on our tax return required?
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Yes, especially in your situation since your scholarships/grants currently exceed your amount billed, it could potentially be taxed as income. The IRS receives the same information and if you do not report it, you will most likely receive a bill in a few months with penalties and interest.
BUT first, I would make sure you have included ALL education expenses eligible for inclusion to reduce the excess scholarships that exceed the "tuition" paid.
There are other qualifying expenses such as those listed in the FAQ below:
Yes, especially in your situation since your scholarships/grants currently exceed your amount billed, it could potentially be taxed as income. The IRS receives the same information and if you do not report it, you will most likely receive a bill in a few months with penalties and interest.
BUT first, I would make sure you have included ALL education expenses eligible for inclusion to reduce the excess scholarships that exceed the "tuition" paid.
There are other qualifying expenses such as those listed in the FAQ below:
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