You are correct, you may claim the amount over $5250, for the AOTC.
You can only claim the AOTC in the year the tuition was actually paid. Although it's not clear why your employer would pay the school in 2025, but not report it as income to you until 2026 (year end timing/bookkeeping?)
Forget about red flags.
The 1098-T is only an informational document. The numbers on it are not required to be entered onto your tax return. However receipt of a 1098-T frequently means you are either eligible for a tuition credit or possibly the student has taxable scholarship income.
If you claim the tuition credit, you do need to report that you got one.
You claim the tuition credit, or report scholarship income, based on your own financial records, not the 1098-T. In the 1098-T screen, click on the link "What if this is not what I paid the school" underneath box 1. You will then be able to enter the actual amounts paid. You will also reach a screen that allows you to adjust the scholarship amount for "amounts not awarded for 2024 expenses".
Or if you find it easier, just change the numbers in boxes 1& 5 to what your records show. The 1098-T that you enter in TT is not sent to the IRS. In your case, delete the amount over $5250 if shown in box 5.
