If you receive educational assistance benefits from your employer under an educational assistance program, you can exclude up to $5,250 of those benefits each year. This means your employer should not include the benefits with your wages, tips, and other compensation shown in box 1 of your Form W-2.
However, it will be included in box 5 of the 1098-T you receive from the school. It's a scholarship the school received on your behalf, as far as the school is concerned. So the amount received by the school from your employer is included in box 5 of that 1098-T.
Here's how to enter your 1098-T in TurboTax:
- Open or continue your return
- Select Search and enter Form 1098-T
- Select Jump to form 1098-t
Some important tips about entering this form:
- Enter your 1098-T exactly as is, even if the amounts are wrong (this is common). You'll get a chance to correct this info and enter additional expenses later on
- Leave blank boxes blank. Don't enter 0 for any blank boxes on the form, as this generates errors
- Parents: If the student listed on the 1098-T is your dependent, enter the 1098-T on your return, even if your dependent paid the tuition
- Students: If you're not being claimed as a dependent, enter the 1098-T on your return regardless of who paid the tuition, unless it was your employer. In that case, just keep the 1098-T with your tax records.
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