How do I file my 1098-T

[Vanessa A]

Are you the parent or the student?

How old are you?  Are your parents still alive?  Can your parents claim you as a dependent even if they are choosing not to?  Do you have a tax liability on line 16 of your form 1040?  Is box 1 of your 1098-T more than box 5 of your 1098-T?

You can enter your 1098-T click the following:

• Federal
• Deductions and Credits
• Show More next to Education
• Start next to Expenses and Scholarship

If you are under 24, and your parents are still alive, even if they choose not to claim you, you are only eligible for the nonrefundable portion of the American Opportunity Tax Credit.  So, if you do not have any tax liability, you would not be able to claim the credit.  

"If you were under age 24 at the end of 2023 and the conditions listed below apply to you, you cannot claim any part of the American opportunity credit as a refundable credit on your tax return. Instead, you can claim your allowed credit, figured in Part II, only as a nonrefundable credit to reduce your tax.

You don't qualify for a refundable American opportunity credit if 1 (a, b, or c), 2, and 3 below apply to you.

1. You were:

a. Under age 18 at the end of 2023, or

b. Age 18 at the end of 2023 and your earned income (defined later) was less than one-half of your support (defined later), or

c. Over age 18 and under age 24 at the end of 2023 and a full-time student (defined later) and your earned income (defined later) was less than one-half of your support (defined later).

2.At least one of your parents was alive at the end of 2023.

3.You're not filing a joint return for 2023."  Instructions for form 8863

The person who claims the student can claim the credit even if they did not actually pay the expenses out of pocket them.  The rules state, that you, your dependent or a third party pays for the expense.  This basically means, it doesn't matter who pays, the person claiming the student claims the education credit. 

Who can claim an education credit?

There are additional rules for each credit, but you must meet all three of the following for both:

1. You, your dependent or a third party pays qualified education expenses for higher education.
2. An eligible student must be enrolled at an eligible educational institution.
3. The eligible student is yourself, your spouse or a dependent you list on your tax return.

Tax Benefits for Education

[Hal_Al]

Q. How do I file my 1098-T?

A. you cannot file it in the free edition of TurboTax (TT).

In TurboTax (TT), enter at:

Federal Taxes Tab (Personal for H&B version)

Deductions & Credits

-Scroll down to:

--Education

  --Education Expenses and Scholarships (1098-T)

That's how you file it. But, the real question is should you and are you allowed to file it.  Usually, the parents of the student "file" the 1098-T to claim the tuition credit.  Sometimes, the student enters the 1098-T to report some of his scholarship as income.  

There's a new urban myth among college students that says they can get a $1000 from the government just for filing a tax form. For most of them, they simply aren't eligible. 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. It is usually best if the parent claims that credit. 

You cannot claim a credit if you are, or can be, claimed as a dependent by someone else.

Reference: Line 7 instructions for form 8863. https://www.irs.gov/instructions/i8863