1098-T & lifetime Learning credit

[ckv12]

So I attended university from 2016-2020. 
my parents claimed me on their taxes from 2016-2018. I claimed myself in 2019. All 4 of those years we used the American opportunity credit. In 2020 I filed for the lifetime learning credit.  Now I got a letter from the IRS saying I didn’t qualify and need to show proof or pay back the credit…. My university only has a 1098-T from 2019 that shows the 2020 semesters. However I made payments to the university on January 10th of 2020. Is it even worth sending a letter of disagreement with proof of payment in 2020? Does this count for the lifetime learning credit? 

[Hal_Al]

Q Is it even worth sending a letter of disagreement with proof of payment in 2020?

A. Yes. That's what's needed,  proof of payment in tax year 2020 for 2020 courses.  The IRS flagged your return because there was no 2020 1098-T.  Include a copy of the 2019 1098-T if it shows box 7 checked.  

Q. Does this count for the lifetime learning credit? 

A. Yes. Payment must be in the same calendar year as the courses.  The one exception is you coulda counted the 2020 spring course, on your 2019 return, if you had made the payment in 2019.

Be sure you didn't already count the full 2019 1098-T box 1 amount on your 2019 return.  If you didn't actually pay some of the box 1 amount until 2020, it should not have all been counted on your 2019 tax return.

[Hal_Al]

You say "So I attended university from 2016-2020.  My parents claimed me on their taxes from 2016-2018. I claimed myself in 2019. All 4 of those years we used the American opportunity credit (AOC)."

That seems to say you claimed the AOC on your own return for 2019.  Be aware  that a full time unmarried student, under age 24, even if you don't qualify as a dependent, is only eligible for the refundable portion of the American Opportunity Credit if he supports himself by working. You cannot be supporting yourself on parental support, 529 plans or student loans & grants. You usually must have actually paid tuition, not had it paid by scholarships & grants.  It is usually best if the parent claims that credit. 

[ckv12]

So I just looked and my university combined my 2020 semesters onto my 2019 1098 T. Box 7 is not checked.  They just put the entire payments received into box 1.  Will it still work if I send them a letter with all my proof of payment? Without the 1098 T from 2019? Or should I include this even though box 7 wasn’t checked?

[Hal_Al]

Q. Will it still work if I send them a letter with all my proof of payment? Without the 1098 T from 2019?

A.  Don't know.  Haven't seen a post with that specific issue.  But you should try.  Let us know the outcome. Yours may become the informative post.

Clearly, it's the school's mistake.  Box 1 is suppose to be actual  payments MADE in 2019, not just billings or include payments actually made in 2020.  Copies of the school's billing statements showing the actual payment dates should suffice; but you may need to include bank statements.  

Q.  Or should I include this even though box 7 wasn’t checked?

A.  I would.  I'd also contact the school to ask for corrected 1098-Ts for 2019 and 2020.