Can amount shown on the 1098T be applied to the AmericanOpportunityTaxCredit or do I need to subtract amount fromthe prepaid tuition plan from the amount shown on 1098T

Can the total amount shown on the 1098-T form be applied to the American Opportunity Tax Credit or do I need to subtract the amount that the pre-paid tuition plan paid from the total amount shown on the 1098-T form ?

425

Level 10

Jun 1, 2019 9:56:45 AM

You do subtract the pre-paid tuition amount from Box 1 to find what is the maximum qualified expense outlay that qualifies for an education credit. In most cases, you also need to subtract Box 5, too. Refer to IRS publication 970,

https://www.irs.gov/pub/irs-pdf/p970.pdf

for details on how the various sources of educational support interact.

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Can amount shown on the 1098T be applied to the AmericanOpportunityTaxCredit or do I need to subtract amount fromthe prepaid tuition plan from the amount shown on 1098T