My school wont issue a new 1098-t form

[Koheun1004]

Hi, I have seen some 1098-t issues with schools and believe that my school messed up with my 1098t form for 2019, too.  I need some advice on this.  please!

My story is... 

Dec in 2018, I was a full time employee but registered ESL online classes (not enrolled in a degree program - probably no academic credits) in order for me to take some pre-requisite courses after, pursuing to obtain a degree in the future but the classes were cancelled so I got a refund of approx. $1,200 in Jan, 2019.  Apparently they issued a 1098-t form for 2019 but I did not know about the form and also did not receive it.  (so, I did not file it)

Fortunately,  I got waived to take the ESL classes, so I took the pre-reqs in the summer 2019, paid approx. $2,000 in Apr 2019.  (I had to quit my job and was enrolled in a degree program - total 8 academic credits / at least half time student as said on the form)  

Last month, I realized that I have the 2018 form when I checked  the 2019 form on student portal.  However, the amount on the 2019 form was only approx. $800 because they deducted the refunded amount ($1,200) out of the whole sum I paid for the summer classes in 2019.  When I initially talked with the school, I understood the refund part so they had to issue that way so I was going to amend the 2018 tax return to get education credits so I could get the credits from the both years no matter what. 

However, I couldn't receive any credits from 2018 but receive a few for $800 (which is the said mount in the 2019 form - so I filed it before knowing the 2018 issue).  I did a lot of research on the issue and found out some factors that I wasn't eligible to claim the credits in 2018 (not a half time student, no academic credit, etc - even if I had filed it on time) so I went to school again to talk about this but they did not care at all.  Since I am eligible to claim the credits for the money I paid 2019 (but I wasn't in 2018), I think I should be able to claim the credits for WHAT I paid which is $2,000, no $800.  I think I could get more credits then.

All they said is nonsense and "we just issued the forms so you have to contact your accountant how to file it correctly".  When I spoke with some accountants, they said this is school's fault and they should reissue the form.  What should I do? Should I amend and re-enter the amount I have paid no matter what?  If this is going to be a hassle with IRS, should  I just let it go?

Please help!

Thank you.

[Hal_Al]

 The 1098-T is only any informational document. The numbers on it are not required to be entered onto your tax return. However receipt of a 1098-T frequently means you are either eligible for a tuition credit or deduction or possibly your student has taxable scholarship income. 

If you claim the tuition credit, you do need to report that you got one or that you qualify for an exception (the TurboTax interview will handle this)

You claim the tuition credit, or report scholarship income, based on your own financial records, not the 1098-T. In the 1098-T screen, click on the link "What if this is not what I paid the school" underneath box 1. You will then be able to enter the actual amounts paid. 

[MarilynG1]

The Education Credit is to help you with Education Expenses you paid 'out of pocket'.

If you paid $2,000, then were refunded $1,200, your expenses are $800.

You don't need a Form 1098-T to claim what you paid (save your receipts). 

In the Education section, EDIT your school, then check the box to indicate that 'you did not receive a 1098-T' and that  you 'qualify for an exception'. 

Then enter the amounts you paid for Tuition and Books and/or Fees.

Click this link for more info on Education Credits. 

[Koheun1004]

Thank you for your message.  I just want to clarify it with you if I was unclear.

I paid $3,200 ($1,200 in 2018- $2,000 in 2019) and the $1,200 were refunded.  The problem is that they deducted the money ($1200) I paid in 2018 from the money I am eligible to claim the credits in 2019.

My whole expenses are $2,000.  I have the receipt. 

[MarilynG1]

You can only claim what you paid during the tax year.  If you paid $2,000 in 2019, that is all you can claim. 

You would have to amend your 2018 return to claim the $1,200 you paid in 2018. 

[Koheun1004]

I paid $1,200 in Dec 2018.  The school refunded it to me in Jan 2019.  I paid $2,000 in April 2019.  The school issued the form for the deducted amount, $800 ($2,000 - $1,200) because the $1,200 was refunded.  

My issue is that I am not eligible to claim the credits for 2018, but yes in 2019.  so I should be eligible to receive the credits for the amount I paid in 2019 which is $2,000, not deducting ineligible credits out of my eligible one which is a big loss for me.

Should I just amend 2018 return to file the $1,200 even thought it was refunded the following year? And also amend 2019 return to file the $2,000 that I paid in 2019 no matter what it says in the form? 

[MarilynG1 · Accepted solution]

You probably shouldn't Amend 2018 to claim the $1200 you paid, since it was refunded in 2019. 

If you have already Efiled and been Accepted for 2019, wait until you receive your Refund to Amend your 2019 return to claim the $2000 Education Expenses you paid in 2019. 

Be sure to save your receipts since you are claiming what you actually paid, not what's on the 1098-T. 

Click this link for instructions on How to Amend a 2019 Return. 

[Koheun1004]

thank you so much for your time and help!!

[MarilynG1]

You are most welcome!

[Carl]

In a nutshell,

 If all "QUALIFIED" education expenses are paid with 3rd party support (scholarships, grants, 529 distributions, etc.) then the school is not required to issue a 1098-T. Period. IN such a situation the student nor the student's parents (if they claim the student as a dependent) will not qualify for one penny of education deductions or credits. End of that part. Now on to the next.

 Colleges work in academic years, while the IRS works in calendar years. So the reality is, it takes you five calendar years to get that four year degree. With that said:

 - Qualified education expenses are claimed/reported in the tax year they are paid. It does not matter what year is paid "for".

 - Scholarships, grants, 529 funds and all other educational assistance received is reported as taxable income (initially) in the tax year it is received. It does not matter what year it is *for*. The taxability of that assistance is offset by the *qualified* education expenses they are used to pay for *in the same tax year the assistance is received.*

Moneis received by the student from the collage as a refund, to include the payment of unused schoarships, grants, etc., are taxable income to the student in the tax year the student is paid that money. It does not matter what year the refund is *for*.

If the refund is for out of pocket expenses (and *only* out of pocket expenses) paid in the same tax year the refund was received, then it's "as if" the out of pocket expense was *never* paid in the first place.

[Koheun1004]

Hi,

one more question for amending 2019 tax return on this issue.  Should I just ignore the previous amount ($800) and put the whole amount $2,000 OR put the rest ($1,200) ONLY to amend?  I already received the federal return money yesterday.  

Thank you!

[ThomasM125]

On the amended return, you should enter the amount that should have been entered originally.