I received a 1098-T, but am I able to claim a credit for education expenses if reimbursed by state prepaid plan?

[Coleen3]

Unfortnately, no. The prepaid plan is paying for the tuition, not you.

However, an American opportunity or lifetime learning credit (education credit) can be claimed in the same year the beneficiary takes a tax-free distribution from a QTP, as long as the same expenses aren't used for both benefits. This means that after the beneficiary reduces qualified education expenses by tax-free educational assistance, he or she must further reduce them by the expenses taken into account in determining the credit. 

[Paul90]

Thank you for the prompt response, but it is still not clear for me and I probably left out some pertinent information.  Can you clarify what "both benefits" pertains to?  Additional info - the 1098-T is my daughter's, but since she is our dependent it is entered on my return.  We contributed to a Florida Prepaid Program when she was a child and are now drawing down on that to pay her expenses.  I thought we could still claim one of the credits you mentioned above.  

[Coleen3]

You can't claim an education credit on tuition paid for by Fla Prepaid. If there was any tuition not covered by FPP, you can take a credit on that amount.