Remember, schools work in academic years, while the IRS works in calendar years. So the reality is, it takes you 5 calendar years to get that 4 year degree. With that said:
- Scholarships, grants and 529 funds are reported as taxable income (initially) in the tax year they are received. It does not matter what tax year that scholarship, grant or 529 distribution may be *for*.
- Qualified education expenses are claimed/reported in the tax year they are paid. It does not matter what year the payment may have been *for*.
So you enter the 1098-T *exactly* as printed. Then later screens in the program will ask you for things that were not included on the 1098-T. In the end, everything adds up to what you actually received in the way of monetary education assistance, and the expenses actually paid.
Also remember that starting with tax year 2018, the "tuition and fees" deduction is no longer available. It expired at the end of 2017 and congress did not renew it.
