1098-T Billed vs Paid

[james-kenney2010]

If I am billed $6,472 in a single tax year (2015), but a portion of the payments occur in January-March of the following tax year, are all of the expenses still a part of the 2015 tax year?

[rjs]

No. The amount billed in box 2 of Form 1098-T is meaningless as far as taxes are concerned. You can only claim tuition expenses in the year that you actually pay the tuition, not the year it is billed. However, you cannot claim a credit or deduction for tuition that you paid for a past year. If the payments you made in January - March of 2016 were for classes that started in 2016, you can claim the credit or deduction. But if the payments in 2016 were past-due tuition that you owed for classes that were taken in 2015, you cannot claim the credit or deduction for those payments.