1098T

[fpastran88]

We wanted to know if we needed to file taxes and include 1098 T form. It was such a small amount and we don't think we will receive credit. It was all out of pocket so no scholarships, grants that would give us excess of funds that would be considered taxable income.

Would we incur a penalty if we didnt add 1098T?

[Hal_Al · Accepted solution]

Q. Would we incur a penalty if we didn't add 1098T?

A. No. 

The 1098-T is only an informational document. The numbers on it are not required to be entered onto your tax return. However receipt of a 1098-T frequently means you are either eligible for a tuition credit or possibly your student has taxable scholarship income (you've eliminated that possibility).

The American Opportunity Credit (AOC)is 100% of the first $2000 of tuition and other qualified expenses and 25% of the 2nd $2000. It is 40% refundable ($1000 max); you get it even if you don't have a tax lability to credit against. There is a four time limit of claiming the AOC and is only available to undergrad students. 

More info:

 https://www.irs.gov/Individuals/AOTC