1098T w/ fundws in excess of tuition

Forum|Forum|1 year ago
February 19, 2025
1 reply
5 views

I have done my best to research this question but I still have questions. My son, 19 years old, in college, received a 1098T. We are claiming him on our taxes. While filing his 1098T I was informed he would need to file a tax return because his scholarships were more than his tuition so he would need to report the excess scholarship as income and he would need to file taxes. My son has no job, so the $2351 is less than the $6200 annual income to file taxes. Does he still need to file taxes and claim the 1098T? If he does not need to file, do we as the parents claim the 1098T even though he is not filing or do we do nothing with the 1098T since he is not getting any education credits? I have also claimed $450 he paid for books on our taxes. Am I still able to claim this if we do not file the 1098T?

Ask the Experts - Deciphering - Feb 2025

DawnC

Level 15

Since you are claiming him as a dependent, you would enter the 1098-T on your return and take the education credit, but there will be no credit since the scholarship funds exceeded the tuition.

The amount that you are eligible to use to reduce your tax bill is, in most cases, simply the amounts paid for tuition and fees minus the amount of scholarships you received. You can only receive a deduction or credit for the amount of expenses that you paid out of pocket.

If the amount in Box 5 (your scholarships) is GREATER THAN the amount in Box 1 (or Box 2, whichever is filled in on your 1098-T), then you cannot use any expenses to reduce your tax bill.

Dependent Filing Requirements

Neither of you are required to report the 1098-T. But your son could file a return and claim some or all of the scholarship, so you can take an education credit on your return. Here is a link to a community discussion if you are interested.

**Say "Thanks" by clicking the thumb icon in a post. **Mark the post that answers your question by clicking on "Mark as Best Answer"