AOC More

[S T]

You are confused - I am confused.

No Box 5 - Only a 1098T with Box 2 Billed

Account Activity is all Financial Aid Loans paid and then some Refunds direct deposit back to Client.

So I netted the Financial Aid Student Loans with the Refunds and it shows the amount paid is $ 2,200 less than what the 1098T shows as being billed. So I am guessing somewhere the Student "dropped a class or two" - (All for the period 1/1/11 - 12/31/11)

I am not even going to try to reconcile to the Amts Billed - as they are probably wrong anyhow - Isn't my only concern the payments made less any refunds from the Student Loans??

Sandy

[FEDUKE404]

Last one for Wed

You are confused - I am confused.

No Box 5 - Only a 1098T with Box 2 Billed

Account Activity is all Financial Aid Loans paid and then some Refunds direct deposit back to Client.

So I netted the Financial Aid Student Loans with the Refunds and it shows the amount paid is $ 2,200 less than what the 1098T shows as being billed. So I am guessing somewhere the Student "dropped a class or two" - (All for the period 1/1/11 - 12/31/11)

I am not even going to try to reconcile to the Amts Billed - as they are probably wrong anyhow - Isn't my only concern the payments made less any refunds from the Student Loans??

Sandy

Well, you know what they say about "assume".......

Since you are in NC, is this a state university? If so, their statements can easily be reconciled, although you might have to deal with 2-3 semesters (and even summer school!) to get all of the numbers. But they ARE there!

The latest fly in the ointment I see is perhaps the student/parent paid the full amount, and either through error he paid what the loan was going to pay, OR the loan was not finalized when payment was due and he then later got a refund.

Again, in this case I might try to nail down the paid (not billed) amounts from the account statement, to include +/- entries. You do have to do some guessing as to what constitutes a "qualifying" charge - I usually take the obvious (tuition) and then start adding a few others until I get to the correct amount. Certainly room/board is a no-go, as are student health fees (separate from - in NC - now required medical insurance if student is not already covered by a family policy).

Suggest you sleep on it, and regroup tomorrow!

FE

[S T]

FE thanks, but you are "assuming" more than what is in my post.

Activity shows It is billed, student loans as payments, then refunds of excess- all 2011 entries not dealing with a past year or a future year. I am using Amts Paid less refunds.

The charges can not be reconciled to the 1098T billed,, I have the entire print out and nothing matches, to the 1098T - It Is NOT NC it is Calif -

I am arriving at an amount that is under the amount for what was billed in Box 2, that I would be allowable Tuition Amt paid

No Grants - No Schloarships - No Room and Board - No nothing else - I am disregarding the Amts Billed and then am left with Student Loan Payments and Refunds - Should be simple DR-CR and netting I would think.

I was concerned due to all of the Large Refunds- but client has a relative large amount for Books and Supplies.

Thanks for your efforts,

Sandy

[Gary2]

I was concerned due to all of the Large Refunds- but client has a relative large amount for Books and Supplies.

This is one of the key points, for avoiding loss of hair or sleep: Once you've decided that the return qualifies for the AOC, there's generally no point in trying to decide if the tuition paid was exactly $6,238 or $9,713, or some number between the two - as long as you're confident that the number really is between the two. (And no complications such as scholarships, 529s, etc. large enough to possibly bring the amount under $4K.)

I don't know if these numbers apply to you, but certainly the larger the Book and Supplies number, the less energy should be needed for the tuition number.

[FEDUKE404]

Would likely use qualifying expenses

FE thanks, but you are "assuming" more than what is in my post.

Activity shows It is billed, student loans as payments, then refunds of excess- all 2011 entries not dealing with a past year or a future year. I am using Amts Paid less refunds.

The charges can not be reconciled to the 1098T billed,, I have the entire print out and nothing matches, to the 1098T - It Is NOT NC it is Calif -

I am arriving at an amount that is under the amount for what was billed in Box 2, that I would be allowable Tuition Amt paid

No Grants - No Schloarships - No Room and Board - No nothing else - I am disregarding the Amts Billed and then am left with Student Loan Payments and Refunds - Should be simple DR-CR and netting I would think.

I was concerned due to all of the Large Refunds- but client has a relative large amount for Books and Supplies.

Thanks for your efforts,

Sandy

My apologies - I wrongly assumed (from your profile) this might be a school in NC.

Aside from the irrelevant NC issues I quoted, the school itself should be able to tell you how they reached the "qualifying" amount shown on the Form 1098-T. Other than the "when paid" issue, in this case that entire number should be 100% reliable for determining the AOC(s). At least for the schools I've contacted, and/or from which I had complete information, the "qualifying expenses" on the Form 1098-T were the same regardless of whether a loan was or was not involved. Things of course get more complicated with grants/scholarships.

And it's not really a DR-CR issue as a CR from a loan should not alter the qualifying expense amount you use for income tax matters.

Of course, in la-la land anything is possible!

[Koss]

When is a refund not a refund?

Without actually reviewing the documents, I can't draw a real conclusion.

I agree with the earlier comment that if there are no scholarships involved, it is sometimes fairly easy to conclude that the student (or parent) is maxed out on the credit, and you can just enter $4,000 and be done.

With that being said...

The fact that the student got a refund does not necessarily mean that they dropped a course.

The refund is often nothing but the excess funds that remain the student's account at the school after the loan proceeds are deposited into the account and the tuition and fees are paid.

In other words, it is not a refund of fees that were previously paid. Rather, it is a refund of a credit balance in the student's account. It is a refund of an overpayment.

It has no impact on any of the calculations that determine the amount of the education credit.

It's actually a lot like a federal tax refund.

It is certainly possible to drop a class and get a refund of tuition. But that will be labeled on the account statement as a refund of tuition. If it doesn't identify what the refund is for, then it's not a refund of anything they actually paid. It's an overpayment.

BMK

[S T]

Thnaks Gary - That is where I am at,

Thanks Koss on the Refunds - that does assist in understanding that part - I realize that a lot of times the Student Loans are in excess of the Tuition Charges - maybe even without "dropped or replaced classes" There was no notation on the Account Activity why the refund, just an excess and direct deposit, but they had posted the entire amount as a payment first - then a same day refund. Seemed all of the Student Loan went to the College first then excess disbursed back. - That is why I was netting the two amounts.

FE - California Colleges are not as good at reporting as NC - so to try to obtain any information from them is almost an exercise in futility.
An example on the Activity Account Fall 2011 were all charges added up 3064 - Student Loans as Payments of 4,727 then a refund of 1,663 - So this math works. - I used 3064 as amount paid for tuition less non allowed Fees.

1098T Billed Amount was over $ 7K - I arrived at almost $5K actually paid -

I think I have arrived at the number, it is reasonable for the return, and reasonable for the Client - and if I had not accessed the "Records" the client would still be furnishing me "useless" paper that has no information relating to this - I have everything from Schedules, Attendance, Sign ups for classes, dropped classes, - you name it I have it - they just could not manage to figure out how to give me the Account Charge-Payment Activity.

So I am good on the $4K entry for Tuition

Thanks everyone,

Sandy