Qualified Education Expenses for Education Credits

[jrhhuff1]

We received two 1098-T forms for our daughter. The first was for a college class that she took at her high school through the local community college. It has an amount in box one. Box 7 and eight are NOT checked. The other was for the nursing school she began attending in January 2022. Both boxes 7 and 8 are checked. My understanding is that the community college expenses can not be used for education credits since she wasn't considered at least a half-time student working toward a degree. My understanding is that the nursing school expenses can be used. The problem I'm encountering is that TurboTax either is using both as qualified expenses. Is this correct?

[Hal_Al]

Q.  The problem I'm encountering is that TurboTax is using both 1098-Ts as qualified expenses. Is this correct?

A.  Simple answer: no.  Most likely it's because you entered something wrong.  If you know the 1098-T from Comm. Coll.  is not qualified, just don't enter it. The 1098-T is only an informational document. The numbers on it are not required to be entered onto your (or your student's) tax return.

In the unlikely case that you are claiming the Lifetime Learning Credit (LLC), instead of the more generous American Opportunity Credit (AOTC), the Comm. Coll. might count*

*If these courses are provided by an eligible college, this cost qualifies for the Lifetime Learning Credit (LLC). The school must have policy of granting college credit for that course, already taken, if the student ever enrolls there. In other words, it is a requirement that the course be a college credit course, even if the student isn't currently a college student. It’s not that  the student is post secondary, it’s that the course is post secondary. Books are not  a qualifying expense, unless included in the course fee..  

[jrhhuff1]

Thank you so much for your reply!! I was assuming that the dual credit class from the community college would not count toward the AOTC, since box is not check that she was at least a half time student. Is that a correct assumption? If so, I will just delete that 1098-T and included only the other one that applies to her nursing program.

[Hal_Al]

Q.  I was assuming that the dual credit class from the community college would not count toward the AOTC, since box is not check that she was at least a half time student. Is that a correct assumption?

A. Yes.

[jrhhuff1]

Thanks so much!