Q. Or do I just list $4000 as the amount of tuition on the parental tax form, and the full amount on the student's form, and THEN report $4000 of that was used for the tax credit on the parental tax return?
A. Yes. Enter the 1098-T on both the student and parent returns. TT will adjust (by $4000) on the student return.
Q. I am tempted to skip all of it and forget the tax credit, though it looks to be about $2500, if I understand the calculation correctly.
A. Yes, the American Opportunity tax credit is $2500 when you use $4000 of expenses to claim it.
You can only enter the 1099-Q on the students return, if he is the "recipient".
If you need more specific help. provide the following details:
- Are you the student or parent.
- Is the student the parent's dependent.
- Box 1 of the 1098-T
- box 5 of the 1098-T
- Any other scholarships not shown in box 5
- Does box 5 include any of the 529/ESA plan payments (it should not)
- Is any of the Scholarship restricted; i.e. it must be used for tuition
- Box 1 of the 1099-Q
- Box 2 of the 1099-Q
- Who’s name and SS# are on the 1099-Q, parent or student (who’s the “recipient”)?
- Room & board paid. If student lives off campus, what is school's R&B on campus charge. If he lives at home, the school’s R&B “allowance for cost of attendance” for student living with parents.
- Other qualified expenses not included in box 1 of the 1098-T, e.g. books & computers
- How much taxable income does the student have, from what sources
- Are you trying to claim the tuition credit (are you eligible)?
- Is the student an undergrad or grad student?
- Is the student a degree candidate attending school half time or more?
