1098-T with box 6 amount

[Prissy99]

Son received a 1098-T with box 6 amount. He will be filing on his own this year and he will not be claimed as a dependent on parents return.  He did not receive a 1098-T last year.  We still used school statements and records to file qualified expenses which was less than $300 in 2024.  I contacted university and they informed me they were not required to issue a 1098-T because scholarship/grants were slightly higher than tuition for 2024 .  This year box 6 was due to a posted payment (scholarship/grant) in 2025 that was for the 2024 school year.  Does anyone have any advise on how to proceed with this 1098-T?  Does he file his return with the 2025 1098-T?  Or do we as parents file it since there is an amount on box 6 and we received a small AOTX in 2024?  Any help is appreciated!

[Hal_Al]

No, you do not file his 2025 1098-T, on your return, if he is not your dependent or 2025.  You may have to file an amended 2024 return to reduce or eliminate the AOTC. 

For more specific advice, more info is needed; 2024 1098-T boxes 1&5 (or what would the numbers have been if one was issued). 2025 1098-T, boxes 1, 5 & 6. What other expenses (books etc) do you have for each year.

The school said "scholarship/grants were slightly higher than tuition for 2024". Did that already include the box 6 amount on the 2025 1098-T?  You need a handle on the numbers. 

Why is he not your dependent for 2025.  How many times have you already claimed the AOTC. What year of school is he in. 

You may actually have an opportunity for more AOTC for 2023, 2024 & 2025. See "loop hole" (#4) at this post on the five main points on the  1098-T:

https://ttlc.intuit.com/community/college-education/discussion/re-what-do-i-do-with-form-1098t/01/37... 

[AmyC]

Box 6 for a prior year, let's check things:

If it had been reported on last year's form, would it have have changed your credit or the student's taxes?

For example:

You claimed $300 tuition for AOTC credit but this scholarship was less than or equal the tuition.

• Then either the student needs to claim the extra income or you need to remove the credit.
• If no credit was claimed and the scholarship just removed the tuition, no credit to change and no income to add to the student.

For example: same as above except scholarship is more than tuition.

Student has taxable income unless he had expenses- books, etc to cover the difference.

There are lots of options and ways to handle a 1098-T so more information may get your farther.

[Prissy99]

Why is he not your dependent for 2025.  How many times have you already claimed the AOTC. What year of school is he in. 

Son graduated May 2025.  Started working July 2025 and had W-2 income for the rest of year.   He lived in a different city.   I am assuming that we can no longer claim him as dependent.  

AOC has been claimed the last 3 years.

I am looking at the university statements that I used to calculate the amounts in 2024, and I actually did add in the amount that is now indicated in box 6 for 2025.  I will call the university to verify if that is the actual grant that was bumped to 2025.  Does this information help?

[Prissy99]

Son graduated May 2025.  Started working July 2025 and had W-2 income for the rest of year.   He lived in a different city.   I am assuming that we can no longer claim him as dependent.  

AOTC has been claimed the last 3 years.

I am looking at the university statements that I used to calculate the amounts in 2024, and I actually did add in the amount that is now indicated in box 6 for 2025.  I will call the university to verify if that is the actual grant that was bumped to 2025.

[Hal_Al · Accepted solution]

Q. Son graduated May 2025.  Started working July 2025 and had W-2 income for the rest of year.   He lived in a different city.   I am assuming that we can no longer claim him as dependent?

A. He maybe still can if he moved out after July 2 (he lived with you more than half the year). 

Can the student be claimed as a dependent in the Graduation year? 

If he/she was a student (under 24) for at least 5 months and lived with you for more than half the year, and did not provide more than 1/2 his own support for the whole year, you can still claim him. Be sure he knows you're claiming him, so he doesn't claim himself. He can only be claimed once. But, he can "file taxes" without claiming his own exemption.

The real question is who should be claiming him in this "transition" year to adulthood. You two have to agree on who is going to claim his exemption. Each should do their taxes both ways and see which way the family comes out best.  Even then, you have to meet the rules. 

There are two types of dependents, "Qualifying Children"(QC) and Other ("Qualifying Relative" in IRS parlance even though they don't have to actually be related). There is no income limit for a QC but there is an age limit, student status, a relationship test and residence test. Only a QC qualifies a taxpayer for the Earned Income Credit.

The rule is that a child of a taxpayer can still be a “Qualifying Child” dependent, regardless of his income, if:

1. he is a full-time student under 24 for at least 5 calendar months of the year (graduating in May usually means you meet the 5 month rule)
2. he did not provide more than 1/2 his own support  (scholarships are ignored and not support provided by the student). 
3. lived with the parent (including time away at school) for more than half the year

So, it usually hinges on "Did he provide more than 1/2 his own support in 2024.

The support value of the home you provided is the fair market rental value of the home plus utilities & other expenses divided by the number of occupants. IRS Publication 501 on page 20 has a worksheet that can be used to help with the support calculation. See: http://www.irs.gov/pub/irs-pdf/p501.pdf  (page 15)

AOC has been claimed the last 3 years.

Q. I am looking at the university statements that I used to calculate the amounts in 2024, and I actually did add in the amount that is now indicated in box 6 for 2025.  I will call the university to verify if that is the actual grant that was bumped to 2025.  Does this information help?

A. Yes, that pretty much says you can ignore the 2025 box 6 amount (and is usually the case). 

But, did you review the "loop hole" info? In you are interested in pursuing that, we would need some numbers.   You would need to know if the scholarship is restricted to being used for tuition.