1098-T for study abroad

[suep12]

My son did a study abroad program at the University of Galway. It was an approved program through his University.  We paid for the tuition from his 529 directly to Galway. Since we will not get a 1098-T from Galway, I created one through the exception but have no federal ID number for them so will not be eligible for American Opportunity Credit. Can I still enter the information so that I will not have to pay taxes on the 529 money withdraw to pay for the tuition abroad?

[Vanessa A]

Tuition abroad is only tax deductible if you pay for it at an a school that is listed as an eligible educational institution by the Department of Education.  Since the university of Galway in Ireland is eligible for the loan program, you can enter their OPEID 01276600 

International Schools that Participate in the Federal Student Loan Program

[Hal_Al]

Q.  Can I still enter the information so that I will not have to pay taxes on the 529 money withdraw to pay for the tuition abroad?

A. Yes, since Galway is an eligible institution.  But, better yet, just don't enter anything.

You can just not report the 1099-Q, at all, if your student-beneficiary has sufficient educational expenses, including room & board (even if he lives at home) to cover the distribution. When the box 1 amount on form 1099-Q is fully covered by expenses, TurboTax will enter nothing about the 1099-Q on the actual tax forms. But, it will prepare a 1099-Q worksheet for your records. You would still have to do the math to see if there were enough expenses left over for you to claim the tuition credit. You also cannot count expenses that were paid by tax free scholarships. You cannot double dip! 

References:

1. On form 1099-Q, instructions to the recipient reads: "Nontaxable distributions from CESAs and QTPs are not required to be reported on your income tax return. You must determine the taxability of any distribution." 
2. IRS Pub 970 states: “Generally, distributions are tax free if they aren't more than the beneficiary's AQEE for the year. Don't report tax-free distributions (including qualifying rollovers) on your tax return”.

 Although, you cannot claim American Opportunity Credit (AOC) without a federal ID number, you can claim the less generous  Lifetime Learning Credit (LLC).  The LLC takes $10K of tuition (vs. only $4K for the AOC), to get the maximum credit amount ($2000 vs. $2500 for the AOC). 

[suep12]

After I enter the number and click continue, Turbo says, the EIN is invalid, so cannot save it. Looks like it is one digit short.

[Vanessa A]

Try adding a 0 in front of the string of numbers.  

[dik777]

It doesn't work.

TurboTax SW only takes the EIN number format of US institutions.

Foreign universities registered in https://studentaid.gov/sites/default/files/international-schools-in-federal-loan-programs.pdf can't be entered into TurboTax since the TurboTax SW takes the foreign college's number invalid and I am stuck with "errors".

What kind of paid tax SW doesn't comply with IRS regulation?

[Vanessa A]

If the school does not have a valid US EIN, then the AOTC cannot be claimed.  However, you can still claim the Lifetime Learning Credit.

[gogaillimhe]

I'm trying to use the federal ID listed above to claim the Lifetime Learning Credit as I'm a US citizen working on my Master's degree at the University of Galway. However, even after adding a leading zero to the number so it fits the expected format, TurboTax's software is telling me that the number isn't valid and it's blocking me from submitting my tax return. 

Can anyone advise? University of Galway is an eligible institution abroad so I wouldn't want to miss out on a significant tax credit that I'm eligible for just because of a software issue.  

[KrisD15]

It is eligible according to Student Aid .gov.

Try using all zero's for the Federal ID number

[Hal_Al]

The number listed above for Galway is only  the Dept of Education (DOE) identification number.  It is not the Employer (Tax) identification number (EIN) required to qualify or the American Opportunity Credit (AOC).  If Galway is not willing to go to the trouble of getting an EIN, you cannot claim the AOC.  Since Galway is on the DOE list, you are eligible for the less generous Lifetime Learning Credit (LLC) and do not need to enter an EIN, in TurboTax, to claim it.

[gogaillimhe]

I tried claiming the LLC tax credit (the only one I am able to claim) without an EIN and TurboTax isn't letting me e-file without an EIN. I get the message: 

1098-T Wks (University of Galway): Filer's federal ID is invalid for Electronic Filing. You must enter a valid federal identification number.

This seems to be an issue with a value that the software expects, not a requirement that the IRS has. If it were $100 it would be one thing but for $2,000, I'd rather not leaver the money I'm eligible for on the table.