It seems like you benefitted from not including nontaxable Employer Provided Assistance (EPA) in the reduction of your tuiton, thus making your credit larger. But in all reality if you received 5,250 in 2019 for 2018, and if you received 5,250 in 2019 for 2019, the second 5,250 would automatically be taxable income on your W2 whether your reconcile last year or not. But this would leave you with 10,500 in 2019, so let's say you have 8,000 worth of tuition, how does it work now since your upside down? If you had 11,000 grand worth of tuiton it would work out alright, because you would balance out in the case of the LLC, but if you had less costs than EPA that year it could work against you and make you owe interest on the tax advantage you received while paying more in income taxes to begin with equaling no credit. I would say you would need to claim it against last years if you have not already completed the tax return to make the numbers match therefore reducing your chance of an issue. This is a very good discussion that I am also needing an answer to. I am wondering, do we have to reduce our tuiton by the amount we receive whether taxable or nontaxable? And how does recieving my EPA after filing affect me if I don't have enough tuiton expenses to cover my EPA in the next year? Also, I am not sure whether or not we reduce our tuition by taxable benefits received anyways. Any other input or answers would be greatly appreciated.
I found this article which might help, https://www.irs.gov/credits-deductions/individuals/education-benefits-no-double-benefits-allowed
