Can I just say.......

[Jesse]

Our state universities have the ledger on the back too. Very useful. But what about next year when books qualify as expenses?

Yes, that's when they'll look at you with that confused "Huh" look and say but you told me we couldn't write off any books!?!

[Lion]

I Know

They think we were wrong all those earlier years, when a tax law changes. Then they start bringing in newspaper clippings again!

[Snaggletooth]

Blind Faith

I think the 1098T is the MOST USELESS form the IRS has ever dreamed up.

Contrary to my usual big mouth, I've stayed out of this thread until now.

I'm not going to try and convince any of you that this is the right thing to do. However, most of the time I simply take the 1098T information as is, and use it.

Yes, I know the pitfalls, and all the reasons it could be wrong. It doesn't necessarily HAVE to be wrong. Billings could (and often do) equal payments. Usually, the categorization of expenses is correct, except many of them do not include bookstores, which are often privately contracted. If I have knowledge, or can suspect, that something is inaccurate, I will pursue correction.

I don't know why it is the preparer's responsibility to mop up behind the carnage left by shoddy and possibly inaccurate 1098-T preparation on the part of the University. Why can't these schools bear the responsibility of their haphazard reporting and let the IRS come after THEM?

The obvious answer is they won't. They are tax-exempt to begin with, and chock full of powerful influence if need be. There is hardly a University on the planet that doesn't have an Accounting/Tax professor capable of interpreting the reporting responsibilities of these 1098-Ts. Yet several years after their introduction, they are being reported no better than when they started.

Oleander, you are correct in everything you state, as usual. But in most cases, I use the information carte blanc and don't torment the client to track down timing differences with the universities, chase it down for a day or two, and delay the return. Time for the old "you bangee, you fixee" doctrine with these schools. But I'm not pretending to suggest that other preparers approach this the same way I do.

[equinecpa]

Snaggle - I read this thread and was saying "say what" to myself. I too use the 1098-T. I don't have time to second guess every form that comes into my office. They may be in fact wrong but unless I know otherwise I'll use them.

[David1980]

I'll preparer a return based on a 1098-T as long as the amounts sound right to the taxpayer. If the numbers don't make sense or don't match up with what the taxpayer remembers paying I toss it (not really, but I ignore the 1098-T and preparer the return based on real numbers, preferably an accounting printout from the school but I'll take numbers presented by the taxpayer as well.)

[RitaB]

Well, this year

I had a client with $8500 or so on the form for amounts billed. No other numbers on the form. At all. I was thinking, "they can't afford that", so I asked if they got any scholarships or financial aid, and wife said, "Oh yeah, it was all paid by the G I Bill." Seems husband was former military. Who knew? She didn't even know that she was supposed to tell me that. All she knew was, "Here's an official tax document, I'll take it to the tax lady."

I never start out by asking to see the print out from school. I just ask client, "Did you pay all that, or did you have assistance or scholarships?" It's not usually a lot of trouble. If they can't remember what happened, I have them dig.

[joanmcq]

Exactly. Then they'll say they got a scholarship, or GI bill or took out a loan. differing treatments.