I entered Form 1098-T information on my return and my Federal Refund increased by the entire amount of money shown on the 1098-T form! Is this correct?

[KrisD · Accepted solution]

Yes, it is possible if your expenses were less than 2,000 on the 1098-T. If you were eligible for the American Opportunity Tax Credit, that results in 100% of the first $2,000 and 25% of the next $2,000. 

If you had $2,000 or less on the 1098-T, you could have gotten the full amount (up to 2,000) applied to your tax liability. If you have other "refundable" credits, such as the Earned Income or Additional Child Tax Credit, your refund would appear larger because your tax liability would be less.