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jahowe65
New Member

Employer Tuition Reimbursement & 1098T

My first semester as a half-time student was Fall 2016. My employer reimbursed the tuition amount in January 2017. I continued as a half-time student in Spring of 2017. My employer is expected to reimburse that amount in May 2017. My university provided 1098T includes the amount billed for Fall 2016 and Spring 2017. Since my reimbursements occur in 2017 am I able to apply claim any credits in 2016? If so, do I include the anticipated amount of reimbursement for Spring 2017? Note that my employer's reimbursement is for the course per credit amount and does not include the numerous tuition fees so I  do expect that I can receive some tax benefit here.
1 Reply
MichaelMc
New Member

Employer Tuition Reimbursement & 1098T

You should not claim an educational tex credit or deduction based on amounts that you know, or can determine, are going to be reimbursed by your employer.

The general rule is that no "double benefits" are allowed. You may still be able to claim some portion of the American Opportunity Tax Credit or the Lifetime Learning Credit, based on the fees that you are paying out of your own funds. However, the amount reported in Box 1 of Form 1098-T must be reduced by the amount of any tax-free educational assistance.

Amounts received by an employee under a written educational assistance plan are excluded from taxable income, up to $5,250 per year.

For more information, please see IRS Pub. 970 Tax Benefits for Education.

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