Form 1098-T

[Bobby]

Each year I get a 1098-T which has box 2 checked amount billed. Box 7 amount paid
for school year beginning next year. This years says 2010.
But the next year I get the same thing. I paid the money for 2009 but nothing is ever in
Box 1 showing paid. I have just been using the amount in Box 2. right or wrong?

[MAJ]

Here's a link to how NYU prepares their 1098-T's.

http://www.nyu.edu/bursar/pdf/1098tsample.pdf

Here's a quote form the link.

Box (1): Payments Received for Qualified Tuition & Related Expenses
The IRS gives the university the option of providing information in either Box (1) or Box (2). New York University has opted to provide information in
Box (2).
Box (2): Amounts Billed for Qualified Tuition & Related Expenses (QTRE)
Box (2) will show the total tuition and related fees required for enrollment or attendance at an eligible educational institution. These tuition and related
expenses are those that were billed between January 1st, 2009 and December 31st, 2009, which includes the qualified tuition and related expenses incurred
in the Spring, Summer, Fall 2009 and/or Winter, Spring 2010 terms. For example if you were billed tuition in December 2009 for the Spring 2010
semester that begins in January 2010, then you may be able to use that tuition in figuring out your 2009 credit.
Please see reversed side of this sheet for a list of
1098-T Frequently Asked Questions.
Log onto www.nyu.edu/bursar/1098T
OMB No. 1545-1574
2009
Form 1098-T
Tuition
Statement
Copy B
For Student
This is important
tax information
and is being
furnished to the
Internal Revenue
Service.
9 Checked if a graduate
student . . . (9)
7 Checked if the amount in box 1 or 2
includes amounts for an
academic period beginning
January — March 2010
(7)
5 Scholarships or grants
$ (5)
8 Checked if at least
half-time student (8)
6 Adjustments to scholarships or
grants for a prior year
$ (6)
3 If this box is checked, your educational institution
has changed its reporting method for 2009
$
(3)
2 Amounts billed for
qualified tuition and
related expenses
$
(2)
1 Payments received for
qualified tuition and
related expenses
$ (1)
STUDENT’S name
Street address (including apt. no.)
City, state, and ZIP code
Form 1098-T (keep for your records) Department of the Treasury—Internal Revenue Service
Service Provider/Acct. No. (see instructions)
FILER’S name, street address, city, state, ZIP code, and telephone number
New York University
Office of the Bursar
726 Broadway, 9th Floor
New York, NY 10003
(212) 998-2700
(A)
STUDENT’S social security number
(C)
FILER’S federal identification no.
10 Ins. contract reimb./refund
$ (10)
4 Adjustments made for a
prior year
$ (4)
(B)
CORRECTED
Box (7) will be checked if:
The amount in Box (1) or Box (2) includes amounts for an academic
period beginning in January 2010 through March 2010. This is
because the educational tax credits are allowed for qualified education
expenses paid in the first 3 months of 2010.
Box (8): Box (8) will be checked if the student was enrolled at least
half-time (minimum of 6 credits) during any academic period
beginning in 2009.
Box (9): Box (9) will be checked if the student was enrolled
exclusively in a program leading to a graduate degree, certificate or
other graduate credential.
Box (10): The reporting institution (New York University) is not
required to provide information in this box.
Box (3):
This box will not be checked, because New York University has not
changed its reporting method for 2009
Box (4): Adjustments Made for a Prior Year
Box (4) represents any reductions to tuition and fees made during the 2009
year for a prior year (please note: the prior year is any year starting as of
2002 through 2008).
Box (5): Scholarships and Grants
Box (5) includes scholarships and grant aid awarded and posted to your
student account between January 1st, 2009 and December 31st, 2009,
which includes the Spring, Summer, Fall 2009 and/or Winter, Spring 2010
terms.
Box (6): Adjustments Made to Scholarships or Grants for a Prior Year
Box (6) represents any reductions made to Scholarships or Grants in the
year 2009 for a prior year (please note: the prior year is any year starting
as of 2002 through 2008).

[BOB W]

Each year I get a 1098-T which has box 2 checked amount billed. Box 7 amount paid
for school year beginning next year. This years says 2010.
But the next year I get the same thing. I paid the money for 2009 but nothing is ever in
Box 1 showing paid. I have just been using the amount in Box 2. right or wrong?

That is why I ask clients "What They Paid". It seems that the 1098T has issues.

[Bobby]

Form 1098-T

Maj thanks for the info. This is the best info I have seen. Just goes to prove that the
the form is worthless.

[FEDUKE404]

Save a tree?

The best use of a Form 1098-T is a coaster for my coffee mug.

I agree: "What did you pay and when did you pay it?" followed by "Did you receive any scholarships or loans or other assistance?"

FE

[Possi]

coaster for coffee!

The best use of a Form 1098-T is a coaster for my coffee mug.

I agree: "What did you pay and when did you pay it?" followed by "Did you receive any scholarships or loans or other assistance?"

FE

Great line! I agree... you have to ask questions on these 1098t's.

[Bobby]

Form 1098-T

Thanks for all the great answers. I have one more question. I was doing a girls tax and
she was a student and I ask her about school expenses and she said I don't have any, I am
using loans. I think loans would be the same as paying cash, someday she had to pay
it back. Someone was at the door knocking and I didn't think about it until later.
What do you think.

[S T]

Student Loans

Yes, student loans qualify as payment for tuition - just another form of payment. You will need the tutition statements from the college and the student loan disbursement, to calculate what was charged and what was paid in a Calendar Tax Year.

Sandy

[FEDUKE404]

Loan non-issue

Yes, student loans qualify as payment for tuition - just another form of payment. You will need the tutition statements from the college and the student loan disbursement, to calculate what was charged and what was paid in a Calendar Tax Year.

Sandy

Well - I guess so. Basically a loan makes no difference to allowable education tax credits, whereas a grant and/or scholarship does. Be sure neither you nor the student get the two confused. And funds from grants/scholarships are applied to offset otherwise allowable education costs according to specific rules - read carefully!

Also don't forget under the new rules there is no "two year" Hope window and that some expenses other than tuition/required fees may also be counted (think textbooks!)

FE

[MAJ]

Loans. Payments & Questions

Yea.. The 1098-T are great as a reminder that the client has some type of educational payment. It's the questions that fine tune that.
As a note - I always be sure to tell them that It's the amount paid out of pocket or by loans but in the end you have to be able to PROVE the payment if you are asked. What type and when did the payment occur.
Here's another one -- A book is NOT deductible if you can purchase it at any regular book store - However, Student-activity fees and expenses for course-related books, supplies, and equipment are included in qualified education expenses only if the fees and expenses must be paid to the institution as a condition of enrollment or attendance. (per Pub970)

There's a fine line there but important as these books aren't cheap anymore.

[Possi]

books

Yea.. The 1098-T are great as a reminder that the client has some type of educational payment. It's the questions that fine tune that.
As a note - I always be sure to tell them that It's the amount paid out of pocket or by loans but in the end you have to be able to PROVE the payment if you are asked. What type and when did the payment occur.
Here's another one -- A book is NOT deductible if you can purchase it at any regular book store - However, Student-activity fees and expenses for course-related books, supplies, and equipment are included in qualified education expenses only if the fees and expenses must be paid to the institution as a condition of enrollment or attendance. (per Pub970)

There's a fine line there but important as these books aren't cheap anymore.

Books and some other expenses are allowed under the new American Opportunity Credit, remember!

[Black Bart]

1098 - T

Each year I get a 1098-T which has box 2 checked amount billed. Box 7 amount paid
for school year beginning next year. This years says 2010.
But the next year I get the same thing. I paid the money for 2009 but nothing is ever in
Box 1 showing paid. I have just been using the amount in Box 2. right or wrong?

Well, Box 2 could be right -- could be wrong. The "coaster' comment actually isn't far off the mark except that the T is useful to get a ballpark figure. The Box 2 billed amount isn't necessarily what was paid (or even what was billed) although sometimes it is. I think the colleges decide to print "billed" amounts rather than "paid" amounts 'cause it's easier for them than tracking/allocating payments. And, as Sandy said, tuition paid by loans counts the same as paid by cash.

About all you can do is talk it over with the client and try to dope out from their words/records something close to what was paid and try not to exceed the 1098-T billing amount (although that's sometimes wrong too). These things are notorious for being all fouled up. A school principal client in this week took his back to the university because they used all of 2008's figures. He tried to get it fixed by phone/fax to no avail, went up there in person and hashed it out. Year before last I called them and the person in charge asked me for advice (I think maybe grad students are doing them in their spare time).

Just try to get the most accurate answer you can (between the client and the college it's not always possible) and don't worry too much about past errors coming back to haunt you as IRS apparently doesn't put much stock in these things either. I've never yet had a kickback/complaint no matter what figure was used. Good luck.