topic Re: 1098T in Education

1098T

Leticia117 — Fri, 15 Nov 2019 06:46:46 GMT

I recently used my TA benefits as a military member. However, I paid over $5,000 Out of pocket. Can I claim this while i file for taxes when I receive my 1098T form? If I can, will I receive all of it back, or partial?

Re: 1098T

PaulaM — Fri, 15 Nov 2019 14:52:46 GMT

You may qualify for the American Opportunity Credit to cover some of your out of pocket expenses. Enter all of your education expenses and 1098-T information into your return and TurboTax will guide you with a series of questions to determine if you qualify.

See this link for reference.

Re: 1098T

Hal_Al — Fri, 15 Nov 2019 16:05:43 GMT

Yes, you may claim it. But you may not claim any amount that TA benefits covered. For example, if box 1 of your 1098-T is $9000 and you received $4000 in TA benefits, you may only count the $5000 difference (+ books and course materials) towards an education tax credit.

You receive a partial refund. If you qualify for the more generous American Opportunity Tax Credit (AOTC), $5000 of qualifying expenses will get you a $2500 credit. $1000 of that $2500 is refundable. That is you get it even if your tax liability is less.

If you do not qualify for the AOTC (grad students and less than half time undergrads don't qualify), you probably qualify for the Lifetime Learning Credit (LLC). $5000 of qualified expenses will get you a $1000 credit (20%), none of which is refundable.