Tax Help: What Do I Do With a 1098-T? What is a Form 1098-T? How Do I Get One? 

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Unfortunately, AARP and VITA tax preparers are trained very little on the subject matter.

Helping "humans"? Are you a bot or an alien? 🤪😉🤣 just kidding. You're welcome! I'm glad it helps.

Thanks for this amazing, intelligent question. Sorry for the slow response. 529 plan withdrawals cannot be claimed as taxable income like scholarships can. So, you are correct that in order to take advantage of the tax credits (which you definitely want to do), you should not pay for all of the student's qualified tuition and related expenses with tax-free money. You should use some kind of taxable income/taxable scholarships OR loans to pay a portion. However, the exact amount that is going to get it the best result will be tricky, based off your taxable income. You might want to consult a tax accountant or contact me at CollegeTaxRefunds.com/contact. The amount to pay with taxable income/taxable Scholarships or student loans will be between $2000 and $4000. Unless I'm mistaken, subsidized student loan interest does not start accruing until graduation, after the deferral period.

Thanks! I appreciate the comment and that you are watching.

Box 4 is an extremely complicated box, haha! You have already contacted me directly at Steve Hunt CPA at College Tax Refunds dot com to discuss your specific situation, and I have emailed you back. The correct and complete answer to this question depends on the following information: • The number in box 1 on the current year 1098-T • The number in box 5 • All other numbers and boxes checked on the prior year 1098-T • Your filing status and adjusted gross income for the current year • Your education credits and American Opportunity tax credit claimed on your tax return in the prior year Helpful information can be found under the heading "credit recapture" in Publication 970. However, without completely understanding everything about these complicated education credits, it's very possible to misread and misunderstand this section.

Thanks for watching and commenting!

I am happy to help you. Student taxes can be extremely complicated, and many people fail to claim the credits they are eligible for. Please send me an email: Steve Hunt CPA at College Tax Refunds dot com.

Another question! 3) If my daughter’s 1098-t goes on my taxes, because she’s my dependent, how/where does she put the 1098-t information on her taxes, when she files? I want to make sure that we don’t unintentionally double claim the information on her 1098-t.😬

@@NothingBtBlueskies Thanks for your questions and for watching. If you are both undergraduate students working on your first 4-year degree, and if you haven't claimed the American opportunity credit (AOTC = up to $2500 credit) 4 times, you claim all qualified tuition and related expenses (QTRE = box 1 tuition, other fees and required books and materials you paid for) on your form 8863. There will be a page 2 of the 8863 for you and a page 2 for your daughter. Both of those should be claimed on YOUR tax return, NOT your daughter's. The maximum amount of QTRE you can claim is $4000, and you definitely want to claim at least $2000, if you're eligible for the AOTC. However, your QTRE must be reduced by any tax-free scholarships or grants (SCH = box 5). If you don't have $2000-4000 of QTRE left after subtracting your scholarships and grants, go ahead and include some of YOUR SCH in YOUR income (on the Wages line) and include some of your daughter's SCH on HER income on her tax return. That makes the scholarships TAXABLE, so they don't reduce your QTRE. Watch other videos on this channel if you have more questions about this or reach out to me at CollegeTaxRefunds.com/contact. This is a very complicated area of tax law, but it's worth thousands of dollars to you to get it right.

I'm sorry I didn't see this until today. I'm sorry you're having parenting and tax challenges. I want to help! At this point, I do not understand the situation that you are describing. Your college student would not qualify for a Child Tax Credit her Freshman, Sophomore, and Junior year. Are you talking about High School? Or are you talking about the American Opportunity Tax Credit? If you are talking about the AOTC, there is no way you could have received $15,000 from that credit over three years. The maximum would have been $7,500, and even that seems unlikely based on the numbers you've given me. So, I'm not entirely certain what your tax preparer was talking about. Based on what you've shared with me, I cannot understand why you would owe your daughter $15,000. And if she was your dependent AND you paid all of her tuition yourself, then there is no reason at all in my mind that you would owe her any money. Without any further information at all, I would just tell you that many college parents are able to get a $1000 credit on their taxes that their college student children could have also possibly claimed if their parents hadn't claimed them as a dependent. Many parents pass that $1000 credit on to their children IF their children are paying their own tuition. So, again, based only on the fact that I can't understand what your tax preparer is talking about, I would simply say that the most I could see you paying your daughter is $3000 for those three years, and that is ONLY if you claimed the American Opportunity tax credit on your taxes those three years and ONLY if she paid her own tuition those three years -- and you are NEVER obligated to share that money with her; that's just something many parents choose to do in those circumstances. Let me know if you have questions.

@@collegetaxrefunds Hi Steve, The tax preparer filled out the FAFSA forms for us. This was for college by the way. So, my understanding is that for the student to qualify for the tax credit they must be: A. Married B. In the military C. Orphaned or D. emancipated from parents. None of those applied. She had to be declared a dependent until she was 21. She went to a university for four years. She had a part time job while being a full time student ,which is where the problem in her mind comes in apparently. She began college at 18. The advice our tax preparer gave us is what we went with and THEN she told our daughter what I have posted to you. I hope you can offer insight into this. Thanks for responding.

@@mogala3068 Thanks for responding. At this point, you have mentioned the Child Tax Credit, the FAFSA forms, your daughter's 1098-T numbers, a nebulous $15,000 amount mentioned by your tax preparer, and an unidentified tax credit with requirements I'm not familiar with, but they are similar to the requirements for claiming a Pell grant without reporting the income of your parents. In other words, I am very confused as to what tax credit or grant we are talking about. We'll never know if your tax preparer knew what she was talking about (most tax preparers do NOT understand the complexity surrounding student tax issues), but it seems very clear to me that she did not do a good job explaining to you or to your daughter what it was she was talking about. I can't make heads or tails of it. I don't know where you would have gotten $15,000 to give to your daughter. If your tax preparer thought there was a way for you to claim $15,000 and give it to your daughter, she certainly should have helped you claim that money, and she should have instructed you to give it to your daughter. Since I'm at a complete loss concerning whatever she was talking about, all I can say is that it sounds like this entire family fued is the fault of your tax preparer; not you or your daughter.

@@collegetaxrefunds Thank you. I agree and sadly nothing has changed other than the fact that the tax preparer is deceased. When I did change tax preparers (before the other one passed) the first thing he noticed was that she had us paying WAY WAY too much in state income taxes for years. We ended up getting back close to $9,000.00 when the state reviewed it. There is very little I can do to assure my daughter no one took anything from her nor would we ever. We sent all our kids to Catholic schools and everything was fine until the late tax preparer threw that bomb into a ripe for the pickings brain of our girl. It's a shame. But, I know I have always followed the law and did what was expected of my finances. I also realize that we're not the only parents who are going through rifts with their 'adult' children over various other things. College can mess a kid up these days. Thank you for your time in answering my questions.

@@mogala3068 I'm sorry for what you're going through, and all I can say (I hope it helps) is that I will pray for you and your daughter to reconcile, as I cannot comprehend what your tax preparer was talking about. I am likely the only CPA in the country focused (for almost a decade) entirely on the tax questions and issues of college students. That makes me the expert on the subject, and I don't think your tax preparer knew what she was talking about, and if she did, she certainly didn't explain it very well to you or your daughter. If your daughter would like to try to explain it to me, perhaps I can figure out what we're talking about. Or if there's anything else I can do for you, please let me know.

These requirements refer to the "REFUNDABLE" portion of the AOTC. The AOTC is $2500, with $1000 of that being "REFUNDABLE." Refundable means that the IRS will pay that $1000 to you (and you will get a check for $1000) even if you didn't pay any taxes to them during the year. The other $1500 is non-refundable, meaning you can only use that credit to offset taxes that you owe to the IRS. However, not everyone qualifies for a REFUNDABLE credit. Basically, you need to be on your own, providing for yourself, and not a dependent of anyone else. If one of your parents was alive AND you are not married (#2 and 3) then you can NOT claim the REFUNDABLE portion of the AOTC unless you could NOT be claimed as your parent's dependent because your earned income was more than half of your total financial support for the year. To understand this rule, you should understand that if your earned income is NOT more than half of your total financial support, it means that someone else could probably claim you as their dependent on their taxes. In that case, the person who can claim you as their dependent (probably your parent) should claim the refundable AOTC for you.

You're so welcome. Thanks for watching and commenting.

Thank you for watching and commenting.

I actually did, starting at 12:09 But it's very confusing, technical, and not easy to do if you're using TurboTax or you don't understand tax laws. Also, I know I need to make a new video. This info is dated. If you are reporting excess scholarships (SOME but not all of the amount from box 5 on the 1098-T), you put it on the taxable scholarships line of schedule 1. When you are claiming the tuition for the education credits (SOME but not all of the amount from box 1) you put it on form 8863 page 2. You can email me at Steve Hunt CPA at College Tax Refunds dot com for help with your specific situation.

Thanks for watching and commenting, Max.

Thanks for the question. There is no way for your parents to "unregister" you as their dependent. If they provide for more than half of your total financial support, and if you are young enough, then you are their dependent. If their income is below $180,000, they should be able to claim the credit on their taxes. If their income is higher than that, and if they do not provide at least half of your financial support, you might be able to claim the credit. Email me your additional questions at CollegeTaxRefunds.com/contact

Thanks for the question. The tax law DOES technically require your daughter to report scholarships that exceed her tuition as taxable. She COULD get "in trouble," but honestly, it's kind of unlikely. I have not heard of the IRS enforcing this provision. But the reason the IRS doesn't enforce it is because they have just 3 years to enforce it, and that's the same amount of time you have to claim the money that they owe to you. The truth is, by NOT claiming her excess scholarship as taxable income on her taxes, YOU are leaving money on the table. There is a tax credit worth $2500 in your pocket that it sounds like you are failing to claim, unless your income is over $160,000 ($80,000 if single). Based only on the information you've given me (and a lot more information is required), it sounds like your daughter could file an amended return and report her $20,000 of taxable scholarship. The result of that MIGHT be that she owes as much as $2500 each year in federal and state taxes. But it could be considerably less; I'm not familiar with your family's tax situation. And then, again, based on what you have shared, YOU might be able to claim as much $2500 each year as a tax credit. For most parents and students, it doesn't work out to be a wash like that. Most parents and students are able to amend their old taxes and walk away with $1300 per year. But it sounds like your daughter's scholarships and grants were so high that the tax might offset the extra credit you could receive by reporting her scholarships as income. For that reason, the IRS probably won't come after you, because you could offset whatever you owe them with an education credit that they owe you. If you are interested in more information, please email me at steve hunt cpa at college tax refunds dot com. It would be helpful if I could look at your tax returns and your daughter's 1098-T forms for the last four years. Then I could tell you exactly how much money you could claim. It might be that you, too, are eligible for $1000 per year or more.

I do not have a more recent video yet. The laws around this haven't changed in the last few years, but people still do it wrong.

Thanks for watching and commenting. If I'm understanding your question correctly, I think you want to know if you can claim the education credits even if your tuition was entirely paid with grants. The answer is "most likely," but it depends on a lot of information you haven't given me. For example, I need to know how much tuition was paid, how much you received in grants, how many years of college you've had, how old you are, whether your parents or anyone else can claim you as a dependent, whether you had any earned income, etc. Please email me directly at Steve Hunt CPA at College Tax Refunds dot com. (Remove all of the spaces and replace the "at" and the "dot" with @ and .)

It might. If your daughters were your dependents and undergraduate students who had at least $4000 each in tuition, fees, and required books that were NOT paid for with scholarships and grants, your CPA should easily be able to use that information to reduce your taxes by $2000-5000 (as long as your income is below about $160k). However, if your daughters were not undergraduate students, not your dependents, or if their total qualified educational expenses were lower than $4000 each, or if your income is higher than $160k, the results will be different. But the most challenging scenario will be if part or all of your daughters tuition and books was paid by scholarships and grants. In that case, your new CPA will most likely not be familiar with the correct way to report a portion of those scholarships and grants as taxable so that they can claim the $2000-5000 in education credits. If your CPA is unable to get you a $1000 "American opportunity tax credit" for each of your daughters, I would need some more specific information about your income and your daughter's 1098-T forms to tell you if your CPA is doing it right. You can reach out at collegetaxrefunds.com/contact.

Always the student.

Box 4 is an extremely complicated box, haha! You may want to email me directly at Steve Hunt CPA at College Tax Refunds dot com to discuss your specific situation. The correct and complete answer to this question depends on the following information: • The number in box 1 on the current year 1098-T • The number in box 5 • All other numbers and boxes checked on the prior year 1098-T • Your filing status and adjusted gross income for the current year • Your education credits and American Opportunity tax credit claimed on your tax return in the prior year Helpful information can be found under the heading "credit recapture" in Publication 970. However, without completely understanding everything about these complicated education credits, it's very possible to misread and misunderstand this section.

Steve, unfortunately, there are many things you've said that are incorrect. I would love to clarify and help. I recommend you reach out to me directly at CollegeTaxRefunds.com/contact. Firstly, the parent NEVER reports the scholarship as income; it's ALWAYS reported by the student, even if the parents claim the tax credit. Secondly, the amount to include in the student's income is not a ratio or a number that can be calculated for everyone without knowing the exact specifics of the student's tax situation. I'm sorry I wasn't clear about these things. Again, I'm happy to help, or I encourage you to study pages 14-17 of IRS publication 970.

If your child made $4950 and will include some scholarship as taxable income, I using IRS Interactive Tax Assistance tool to see if there is a need to file a return.

@@almaur703 good suggestion

Thanks for the question. I would definitely want to know why box 1 is empty. If you paid for tuition, even with scholarships or loans, or should be in that box. You cannot claim the American opportunity tax credit (worth up to $2500) unless there's a number in that box. I would try to figure out from your school why there's not a number in that box and what that number should be. If possible, have them reissue the 1098T with the correct amount in that box.

$800 is the refundable portion of the credit when you claim $2000 of qualified expenses. Everyone should claim at least that much.

@@collegetaxrefundswow eye opening

Are you going to have any more years of higher education with a larger amount of tuition? I ask because your $58 of tuition should get you a $23-58 education credit on your taxes, which is certainly not worth the work to prepare an amended tax return. Additionally, you only get to claim the education credit four times, and it's worth up to $2500, so you should wait and claim the credit during the four years when you pay the most for college. However, my final question is, did you really only pay $58 in tuition, or is that what was left to pay after applying your Pell grants? If you paid thousands of dollars in tuition, but it was all covered by Pell grants, NOW you should file an amended return, where you report $4000 of your Pell grants as taxable and then report $4000 of tuition. This will result in a $1000-2500 credit.

Generally speaking, box 7 doesn't change anything about how you handle a 1098-T. The education credit form (8863) requires you to tell the IRS if box 7 was checked for the PREVIOUS year. The rules say that you must claim the education credit using qualified tuition and related expenses (box 1) paid during the current year. They do not say that you actually have to be a student during the current year... But you must be a student this year or during the first few months of next year. Box 7 simply tells the IRS if some of the tuition in box 1 was for the first few months of next year. In short, if you had tuition in box 1, you can use it to claim the American Opportunity tax credit, if you qualify, even if you weren't a student this year, as long as box 7 is checked.

Thank you for the explanation. When I called the university they said box 1 tuition was for fall 2023 and Spring 2024. But box 5 included spring 2023, fall 2023, and spring 2024. So therefore looks like she has way more scholarships than what tuition was. Turbo tax experts were not any help. They kept changing where I subtracted off the excess scholarship. And also still told me I cannot claim AOTC which I still can. By claiming excess scholarship as income under student and allocating some of it to room and board correct?

@@kimberlypadgett2389 TurboTax regularly costs people (who think they are saving money) thousands of dollars because of mistakes. In order to claim the American Opportunity tax credit with excess scholarships in box 5, all of the excess scholarships PLUS 2000-4000 MORE need to be reported as taxable income on the STUDENT'S tax return. Then the parent (if the student meets the definition of a dependent) or the student (if they don't) can claim the education credit, but only if they have sufficient earned income to have paid the qualified tuition, and only if their income is not above the $80-160k limit (depending on if they are single or married). There are numerous other rules and situations that come into play that dictate how much of the scholarship should be included in the student's income. If you include too little, the IRS will refuse to let you claim the aotc. If you include too much, the student will pay too much tax, especially on their state taxes. Please email me at Steve Hunt CPA at college tax refunds dot com for specific help in your situation.

This is incorrect. The amount of taxes withheld from your paycheck has absolutely nothing to do with the amount of the education credit you will qualify for. The goal with your W-4 should generally be to withhold exactly the correct amount of tax from your paycheck so that you do not owe any additional tax at the end of the year and so that your refund is zero.

Thanks for watching. If you provide more than half of the total financial support for your daughter, then you should claim her as your dependent. And if you do your taxes right, there's really no way to "avoid" the 1098-T (but many people choose to leave the 1098-T off, even though it's technically incorrect AND it's often a costly error). However, you can do as you've discussed, reporting some of her scholarships as taxable income on her tax return, then you'll be able to claim the American opportunity tax credit on your tax return. The amount of scholarship to report on her taxes depends on her tuition, books, and total scholarships. I would be able to help you more specifically if you email me at (Steve Hunt CPA at College Tax Refunds. Com) - remove all spaces and replace at with @

Correct. If you paid $2500 more for qualified tuition and related expenses over and above your son's scholarships, you can simply report the $2500 and claim the American opportunity tax credit. You will be able to claim up to $2125 in credit. However, you can claim up to $325 more in credit if you can report $4000 of qualified expenses paid over and above your son's tax-free scholarships. To do that (assuming you paid exactly $2500 more than your son's scholarships), your son would need to report $1500 of his scholarships as taxable on HIS tax return. Then you can report the entire $4000 of qualified expenses on YOUR tax return.

Most CPAs will tell you that if you don't need to file a tax return because of money you earned this year, then you also don't NEED to file a tax return because of the extra scholarships you received. HOWEVER, you might WANT to file a tax return and report a portion of the scholarships as taxable so that you can claim the valuable AOTC. It depends on several things, like whether your parents can claim you as a dependent, how much money you made last year from a job, whether you borrowed any student loans, how much scholarships you received, how much your tuition was, and several other factors. Many students who benefit from reporting their scholarships as taxable and claiming the AOTC get a refund of $800-1300. If you would like me to look at your specific situation, please email me at (Steve Hunt CPA at College Tax Refunds.com) -- remove all spaces.

Thanks for the question. Assuming your income qualifies for the American opportunity tax credit of up to $2500, and assuming you don't have any Earned Income Credit, you should probably include $9000 of scholarship income on the wages line of your daughter's tax return. This will allow YOU to claim the full $4000 of qualified tuition and related expenses for the American opportunity tax credit. However, if your income is too high to claim the American opportunity tax credit, or if you have the Earned Income Credit, then it works differently, and you should contact me at CollegeTaxRefunds.com/contact

I can see how that would be confusing. The Form 1098-T is filed by the college, not the student. The student files a tax return, not a 1098-T.

That is not correct. Your son's scholarships are reported as taxable on HIS tax return. The student ALWAYS reports the taxable scholarships that they received on their own taxes. The parents get to claim the education credit on THEIR taxes, however, if they are legally able to claim the student as a dependent.

You are correct that the student must always be the one to include the Scholarships in their taxable income. The parent never includes the scholarship income, even if the parent is the one claiming the education credit. I have posted a new comment explaining this and pinned it to the top of the comments. Unfortunately, even if I explain this clearly in classes and videos, it is still confusing and misunderstood by many people. This is just a complicated area of tax law that many people (including many IRS agents) get wrong. I suggest that if taxpayers don't thoroughly understand the related pages of Publication 970 that they get assistance from CollegeTaxRefunds or someone who does thoroughly understand those pages. Getting it wrong causes IRS challenges. The IRS will challenge you 25 percent of the time even when you do it right.

For most people, the answer to your question is Yes. If the source of your sponsorship was a scholarship or grant, you can typically include part of it in your taxable income and then either you or your parents can claim a valuable tax credit worth $800-2500. If your sponsor was giving you a tax free gift, you should definitely claim the education credit, and you don't even need to include the gift in your income. I would love to hear more specifics about your situation and answer your unique questions. Please reach out to me at CollegeTaxRefunds.com/contact

I'm just starting to wrap my brain around this, but so far, my understanding is that in order to potentially maximize your AOTC, you would need to pay taxes on the difference *plus* an extra 1000, so the full $4000 of QTRE is left to claim the full $2500 of AOTC. Run the numbers both ways and see how much of a difference it makes for you. That extra $1000 of taxable income may influence other credit eligibility that can sway the numbers.

This response is correct. Thank you both for watching and commenting!

That's a great question. You may need to ask your student finance office or bursar why your 1098T shows scholarships only and no tuition. It could be that you paid the tuition in a different year than you received the scholarships, or it could be that they prepared it wrong. Let me know what they say. And if you have more questions, email me at CollegeTaxRefunds.com/contact

Thanks for the question. The IRS won't care that your parents waited until 2022 to claim your education credits for the first time. They are happy not to pay you the $1000-2500 that they owe you for each of the other years you were a student. But your parents may want to seriously consider amending their tax returns for 2020-2021 to claim that money. The IRS shouldn't get to keep it. If you happened to receive scholarships and grants that were within $4000 of the amount of your tuition, or if your scholarships and grants were MORE than your tuition, there is a good chance that your tax parents' tax preparer will not know the correct way to include some of your scholarships and grants in YOUR taxable income so that your parents can claim the very valuable American Opportunity Tax Credit on THEIR tax return. If you or your parents find out after you give the tax preparer your 1098-T that they are NOT claiming AT LEAST $800 on the "American Opportunity Tax Credit" line of the tax return, please be sure to email me to see if we can get your parents some more money for all three years: 2020-2022. Most students with scholarships and grants miss an average of $1300 every year. My email is (remove all the spaces and change the "at" to @)

Unfortunately, it is not an easy question to answer. The student must claim all of their excess scholarship as taxable. This means everything beyond their tuition and required books. At that point, however, the parent and student are still not allowed to claim the education credit, because all of the tuition and required books were covered by tax-free scholarships. In order to claim the education credit, you have to reduce your tuition and required books by the amount of tax-free scholarships. Since your tax-free scholarship equals your tuition and required books, you have no tuition and required books left with which to claim the credit. In order to claim the education credit, you now need to include in the student's taxable income an additional amount of scholarship that is equal to the amount of tuition and required books that you would like to claim for the education credit. Usually, this is at least $2,000, but not more than $4,000. In summary, the amount of scholarship that most students should include in their taxable income is everything in excess of their tuition and required books plus $2,000 to $4,000. This allows the parent, or the student if they are not a dependent, to claim $2,000 to $4,000 of qualified tuition and related expenses towards the education credits.

I'll try to give an example using numbers.

Assume your student has $6,000 of tuition and required books, which is $5000 in box one on their 1098-T Plus a thousand dollars of books, and they have $13,000 of scholarships or grants, which is box 5. By law, the student must include $7,000 of their scholarship in income, because their scholarship exceeds their tuition and required books by $7,000. However, most tax software, most CPAs, and even the IRS will tell you that this is not necessary. That is the way everyone has been trained. However, the law technically says that the excess scholarship must be reported as taxable. At this point, $7,000 was taxable, and $6,000 of scholarship was tax-free. The tax-free scholarship is assumed to be used to pay the required books and tuition costs. This leaves no tuition costs or books available to claim the education credit. In order for the parents, or the student if they are not a dependent, to claim the education credit, the student must include additional scholarships in their income. Usually, it will benefit the family to claim at least $2,000 of tuition towards the American opportunity tax credit. When you claim $2,000 of tuition towards the credit, you can receive a tax credit of up to $2,000. In order for the family to claim $2,000 of tuition towards the tax credit, the student must include an additional $2,000 of scholarship in their income. At this point, the student will have included $9,000 of scholarship in their taxable income, and then the family can claim a $2,000 American opportunity tax credit, because $2,000 of the tuition was paid for with taxed income, such as wages or even loans. In order for the family to claim the last $500 of the American opportunity tax credit, the student must include an additional $2,000 of scholarship in their taxable income. This allows the family to report an additional $2,000 of tuition as qualified tuition towards the education credits. However, the additional $500 of Education credit is sometimes not worth the increase in tax that the student might pay if they include an additional $2,000 of scholarship in their taxable income. Therefore, it can be a challenge to determine exactly how much scholarship the student should include in their taxable income. If they include too much scholarship in their taxable income, they could end up paying too much in tax, or they're earned income credit might decrease. But if they don't include enough scholarship in their taxable income, then they will not be allowed to claim the maximum American opportunity tax credit. I hope that made sense. It really is a very challenging area of tax law. Most people get it wrong. I spent almost a decade doing only this for my tax clients.

I also spent a good chunk of that decade arguing with the IRS about how this works. Even the IRS does not understand it.

@@collegetaxrefunds Ahh! This is the kind of "recipe" I was looking for. Now I understand where adding "up to 4K" comes in. Thank you again so much. It's clear you love what you do and I hope someday I am as happy in my career as you are! SUBSCRIBED FOR LIFE

Yes. Please contact me at this email: Steve Hunt CPA at College Tax Refunds. com Remove all spaces and replace "at" with @

Unfortunately, it is more complicated than that. The student needs to claim AT LEAST the excess scholarships in income (the amount that 1098-T box 5 exceeds box 1 + REQUIRED books and supplies) and then they ALSO need to include in income an equivalent amount of scholarship as the expenses you intend to claim as Qualified Tuition and Related Expenses for purposes of the AOTC. It requires a specific formula (or guess and check) to determine the exact amount of scholarship to include in income to claim the correct amount of AOTC to maximize the total tax benefit. The more scholarship you include in income, the more AOTC you can claim (up to $4000 of QTRE), but this might also increase the student's federal and state tax liability. In summary, the amount of scholarship to include in the student's income in the case you've described is usually going to be the excess scholarship PLUS the amount of QTRE you are claiming, but you don't want to claim too much or too little. If you have more questions about this extremely complicated calculation, please contact me directly at this email address: Steve Hunt CPA at College Tax Refunds. com (remove all spaces and change the at to @)

Thanks for watching and asking the question. It challenging to explain a full answer in the comments. I have other videos on the channel that explain this, but I want to do a better one. It will be long. You cannot put just any amount. You must put enough of your scholarships (I'm including fellowships and grants when I say scholarships) on the wages line to allow you to claim the education credit, but if you put too much of your scholarships in wages, it can reduce your tax refund, especially if you're getting credits like an earned income credit, retirement credit, dependent care credit, or advanced premium tax credit. Whatever financial aid you DON'T include in wages must reduce your qualifed education expenses, thereby reducing your education credit. A quick rule of thumb (that doesn't apply to everyone) is this: 1) start by putting only as much financial aid in your wages as you must put in wages to claim $2000 of qualified education expenses on form 8863. That means if you had at least $2000 more qualified education expenses than financial aid, you don't need to include any scholarships in income. But if you had less than $2000 of qualified expenses after subtracting your otherwise tax free scholarships, try including enough of your scholarships in income to increase your eligible qualifed expenses to $2000. For example, if your scholarships are $5000, and your qualified tuition and related expenses are $4000, you have NO eligible expenses ($4k-$5k < $0). You must include $3000 of scholarships in income in order to claim just $2000 of qualified expenses. 2) Check to see if your tax refund went down or the tax you owe went up after you did that. If it did. Reverse it. Don't include any scholarships in income or take the credit at all. You're done. 3) If your tax refund went up or your total tax went down, check to see whether your earned income credit went down. If you had earned income credit before doing step 1, and it went down, then you're done after claiming $2000 of qualified expenses and including the related scholarships. 4) If your earned income credit didn't decline, or if you never had an earned income credit, now try including as much scholarship in your income as necessary to claim $4000 of qualified expenses. In the example given above, you must include all $5000 of your scholarships in wages, so that you can claim all $4000 of your tuition towards the education credit. But in another example, if you have $5500 of qualified expenses and $5000 of scholarships, you must include $3500 of scholarship in your wages in order to claim $4000 of qualified education expenses. 5) If the last step did not cause your earned income credit to go down, or if you never had an earned income credit, stop here you're done. Claim the full American opportunity tax credit using $4000 of qualified expenses. 6) If step 4 caused your earned income credit to decline, start reducing the amount of scholarship you include in your income and the amount of qualified expenses your claim in $10 increments until your at a level of scholarship/expenses that does NOT decrease your earned income credit. You will end up claiming somewhere between $2000 and $4000 of qualified expenses, and you will report the required amount of scholarship in your income that is necessary by law and no more. This will give you the lowest taxes and the highest refund possible. Be sure that you reduce your qualified expenses by every dollar of financial aid NOT included in taxable income. Be sure you don't try to claim the American opportunity tax credit more than 4 years for the same student. Be sure you don't claim the credit in any year unless the student was an undergraduate student working on their first degree for at least one semester of that year. Be sure that you ALWAYS claim the credit on the tax return of the person who claimed the student as a dependent. Be sure you ALWAYS report the taxable financial aid on the STUDENT'S tax return, never on anyone else's tax return, regardless of who claims the student as a dependent. I hope some of that was clear.

This is a complicated question that depends on your tax situation. If you want to reach out to me at (steve hunt cpa @ College Tax Refunds.com) - all one long word - then I can ask you specific questions about your taxes and answer your questions.

Thanks for watching and commenting. You should report all of your son's scholarship income as taxable on his taxes, unless his income for the year was too low to file a tax return (it sounds like it was). Then, you should claim your son as a dependent on your taxes, and you should report all of his tuition and books as qualified expenses for the American opportunity tax credit on your taxes.

If your son received a 1098-T with tuition on it during the past 3 years, you can amend your old tax returns to claim the tax credit you missed, which might be up to $2500 per year, if you and he both meet the qualifications. If he received scholarships or grants during that time, you might have to include those in his income on his tax return - but probably not if he didn't file a tax return or have any other income.

Yes. If you're filing status is married filing separately, you cannot claim any of the education credits.

As a side note, I can think of extremely few examples when two people would want to file separately. Maybe you should reach out to me to discuss why you're filing separately, and we can see if there's a better way to achieve your goals. Email me. Steve Hunt CPA at College Tax Refunds dot com.

Thanks for watching and for your question! Graduate students, foreign students, and OPT jobs are not my area of expertise. I focus on US undergraduate students with too much scholarship and no job. However, I can't think of a reason you need to give the 1098-T to your Company or to write on it your books and computers. This form is for your information, so that you can legitimately claim an education credit or deduction on your US taxes this year. If you file a US tax return for 2021, please give the 1098-T to the person preparing your tax return.

If they won't give you one when you ask nicely and tell them that your CPA needs it, then you can ask them for a substitute form such as a receipt or an account statement that clearly shows amounts AND DATES that tuition was paid or charged to the account and when scholarships were applied to the account.

Thanks for watching and for your question. You can claim the AOTC for your wife and the LLC for yourself, as long as neither of you can be claimed as a dependent by someone else, and as long as you both otherwise qualify for the credits. You might also be interested to know that YOU can claim the much more valuable AOTC for YOURSELF this year IF you and your parents have NOT claimed it 4 times for you in the past AND if you had not graduated BEFORE the beginning of 2022. In other words, if you graduated in April-December 2022, you can still qualify for the undergraduate tax credit this one final time.

Box 1 shows the tuition you paid. Depending on your other income, your scholarships, your book expenses, your earned income credit, and so many other factors, you can use that number to claim the American opportunity tax credit, which is worth up to $2500 cash back on your tax return. If you have at least $4000 more tuition in box 1 than scholarships in box 5, almost any CPA or free tax program will help you correctly claim this credit (or your parents can claim the credit if you're a dependent). But if your scholarships in box 5 is almost as much or more than your tuition in box 1, most CPAs and tax programs will NOT calculate the credit correctly.

Thanks for the question. If all your 2022 tuition and qualified expenses was billed to your student financial account in 2021, then that is the year you must claim the education credits (2021). You cannot claim an education credit in 2022 unless you paid qualified expenses (tuition, etc) in 2022, which it sounds like you did not. You don't need to do anything this year (2022), but you can potentially go back to 2019-2021 and amend those tax returns to claim the valuable education credits, if you want, and if you didn't already claim them. Reach out to me at (Steve Hunt CPA at College Tax Refunds .com) if you want my help in your specific situation. Remove the spaces and change the "at" to an @

Thanks for watching and thanks for the question! You should definitely examine carefully whether your parents can or should claim you as a dependent. I need to make a separate video about this. If your parents pay for more than half of your support during the year (this includes all of your living and school expenses, etc.), and if you are young enough to be their dependent, then you cannot claim yourself. However, if you work with your parents to make it so that you are providing your own support (whether through a job or through loans and financial aid), then you can arguably claim yourself and qualify for the credits. You should talk to a CPA about how to do this right.

@@collegetaxrefunds Yes please, have you made a video on whether a parent can or should claim the student as a dependent?

I have not yet. I will bump this up on my to-do list.

You will not get in trouble. In almost every case, the 1098-T can help your parents to get $800-2500 more back on their taxes, if their CPA knows to report your grants on your own taxes and claim the AOTC credit on your parents taxes. Forgetting to claim the credit means your family missed out on hundreds or thousands of dollars. They can amend their old taxes to claim that money, but no one will get in trouble. If your parents need help amending the old taxes to get the money, or if you just want me to check to see if there's money available, reach out to me at (Steve Hunt CPA at College Tax Refunds. Com).

@@collegetaxrefunds Thank you. Would it be okay to give the 2020 and 2021 forms at the same time as I will be giving the 2022 and let the tax preparer check if there’s money available? Will there be a chance of not getting money back due to me not turning in the 2020 and 2021 forms in on time? Also, is it $800-2500 per year or is it accumulative of all years? (fyi: I am unemployed and my parents file their taxes jointly with me as a dependent)

@@kindree5414 you can provide the 2020-2022 1098-T tax forms to your parents' tax preparer at the same time. Your parents can in most cases receive $800-2500 back per tax year. Many parent choose to share this money with their college student unless the parents are the one paying for all of the child's education. However, if you have received substantial scholarships or Pell grants (especially if your scholarships in box 5 is more than your tuition in boxes 1-2 of the 1098-T), it's extremely likely that your tax preparer won't know what to do with these forms and will tell you that nothing can be done with these forms and that you don't qualify for the $800-2500 American opportunity tax credit. In most cases, this is incorrect. Unless you yourself are receiving the Earned Income Credit, or unless your scholarships and grants exceed your tuition by more than about $20k, or unless your parents work for the university, there's an extremely high chance that your parents should qualify for this $800-2500 credit, but your tax preparer might tell you that it's not possible or not worth it to claim it. This is a mistake. If that's what they say to you, and they will not help you get the credit for the past two years, please reach out to me again. I will take a look at your parents taxes for free and tell them EXACTLY how much money they can get back and how much it will cost them.

If the entire amount in box 1 was paid by a tax-free distribution from a 529 plan, the American Opportunity tax credit cannot be claimed for the student. The credit can be claimed only if at least some amount of the qualified tuition and related expenses was paid for with taxed earnings. Generally, you can claim that tax-free assistance was used to pay for housing or other non-qualified expenses. Alternatively, you can pay tax on the scholarships and grants, turning them into taxable income. However, there is no way to use 529 distributions for anything other than qualified expenses, and there is no way to include those distributions in income. So, a 529 plan is unfortunately one way to prevent students from claiming the American Opportunity tax credit.

Thanks for the question. You should Google the name of your school and 1098-T, and you'll usually discover how to download your 1098-T. However, if your scholarships and grants were more than your tuition, you may not have received a 1098T. In that case, you need to request that your financial account or bursar's office issue one for you. Tell them your CPA says you need it. But only if you understand the method that I teach on this channel, where you include some of the scholarships in your income in order to be able to claim the American opportunity tax credit.

Thanks for the question! The answer is complicated. It depends on what the adjustment was for. Do you know what it was for? What are the amounts in box 1, 4, 5, and any other boxes with data?

Thanks for your question. If the only number is in box 4, you probably don't have to do anything this year. If you previously claimed an education credit, the IRS might expect you to recalculate or amend that, but I've never heard of them actually demanding that. But if you're a recent graduate, there's a great chance that you received these 1098-T forms for the last 3 tax years (2019-2021) and you didn't use them to claim the $800-2500 you could have claimed every year. If you didn't claim the maximum American opportunity tax credit on your taxes for the past 3 years, let me know!

Hey, sorry for my slow response. That's a lot of questions. Most importantly, you're probably not going to get into trouble or owe tax for not reporting your excess scholarships as income. However there's a possibility you could have received a $800-1000 or more refund on your taxes (or on your parents' taxes) if you had reported some of your excess scholarships as taxable income. Unfortunately, I can't tell you whether that's the case without knowing about a dozen numbers from your taxes and your parents' taxes. I don't know why your tuition and related expenses is showing $0. That's a question for your school. That might be the way they indicate that your scholarships were more than your tuition. (It's not a correct method, in my understanding, but some schools do it that way.) If you had included scholarship in your income, it would NOT affect your Pell grant eligibility. They want to know what your income is and what part of that is scholarship so they can back it out from your income when you apply for grants. Let me know if you have more questions

If your student had enough earned income to provide for MORE than half of his total financial support (including ALL his costs of living) and you did NOT provide him with more than half of his total financial support, then he is not your dependent. If you DID provide more than half of his total financial support (for example, he lived at home and ate your food and was on your health and car insurance, etc.), then he is your dependent and cannot claim himself or the credit.

Thanks for watching! In order to use last year's 1098-T to claim the American opportunity tax credit (usually worth $800-2500), you will need to amend (fix) last year's tax return for yourself and your parents (of you were a dependent). If you would like more specific assistance, please email me at (Steve Hunt CPA at College Tax Refunds. Com) - remove all spaces and change at to @

I figure out how to do it in TurboTax. Now, I understand why you want your child to list it under other income 1099-Misc on their tax return. I see how you get a bigger refund doing it this way. I would have missed out on nearly 1400 dollars for the one who used the Hazlewood Act and received scholarships. Huge difference when the scholarship money is listed as taxable income. Getting over 8k back. Thank you for the tips.

Thanks for watching and for commenting. I'm so sorry I didn't respond earlier. I was never notified about your comments. You CAN claim the AOTC for two students, if both qualify. You should NOT include their excess scholarship as "Miscellaneous income," but you should include it on the student's tax return as "taxable scholarships." If you've done it correctly, it will show up on the WAGES line, NOT on the business income line. TurboTax is not very helpful at all when it comes to doing this correctly. Most people who use TurboTax miss out on this credit. I'm glad you figured something out, and I hope you didn't end up missing too much. If your elder daughter has been in college three years before this year, you should be able to go back and amend the previous three tax returns for her and for you and collect an additional $800-2500 each year, if you do it right. If you want to discuss it more or you need my help, please email me at (steve hunt cpa at college tax refunds.com) -- remove all spaces and use an @ instead of at.

If she's more than a half-time student, it's possible to qualify. There's a box on the 1098-T that says "more than halftime student." That needs to be checked by the university.

If you're in high school and you attended some college courses, you don't have to do anything with the 1098T. But you might want to give it to whoever prepares your parents' taxes. It's possible they can deduct your tuition or claim the lifetime learning credit under certain circumstances.

Thanks for watching and for the question. This is a complicated question that depends on things I don't know, like your financial situation and current sources of income and wealth, the availability of scholarships and grants, your wife's future income potential, the availability of loan forgiveness if your wife takes a certain kind of job, and the rate you can get on a student loan. Student loans are a huge challenge and regret for many people. They can last for years and suck away a large amount of your income. But sometimes you can get a student loan rate that is less than 2 percent, which can make it all much more reasonable. In short, I can't answer your question without a lot more specific information about you, but I can tell you that generally it's always better to avoid debt that you yourself must pay back. When you take on debt, you become the servant you the bank, and a portion of your earnings go to your master, the bank, for many years of your life-and you can't quit your job or stop serving your master or they will come take away your home and your other assets. Avoid debt if you can. If you want to save money and be financially healthier in the long run, do what you can to qualify for scholarships, grants, fellowships, tax credits, and other forms of education assistance and income before you take on debt. Student debt is usually only wise for students who have no other means of paying for college AND they have a high likelihood of getting a high paying job when they graduate, like medical or law school students. Their future income will be high OR else they can get some of their debt forgiven by taking a lower-paying, service-oriented job.

Thanks for the question! If only Box 1 has a value, and if you are otherwise a more-than-halftime student working towards your first 4-year college degree, then your parent/guardian (whoever claims you as a dependent) should report the amount in Box 1 on their tax return on Form 8863 as qualified tuition and related expenses. Assuming their gross income is below $80,000 ($160,000 if married filing jointly), this will give them a tax credit of $1000-2500. If you have more questions or have issues, please email me at Steve Hunt CPA at College Tax Refunds dot com.

⁠@@collegetaxrefundsOk, thank you. I will send an email

All the excess scholarships + $4000 must be included in the taxable income on your child's tax return. It's reported on Schedule 1 on the line that says "taxable scholarships." I don't know how to do it on your tax software, I'm sorry. It actually may not be possible with some software. After the student includes the income on their taxes, the parent can claim the credit on their taxes.

Thank you for reaching out. It would be a mistake to simply report the amount in box 5 on your taxes. Instead, if you are eligible, you should report SOME of the box 5 amount and then either you or your parents should claim the $800-2500 American Opportunity tax credit. Are you a dependent of your parents? How old are you? How many years have you attended college? If you would like, please contact me directly at CollegeTaxRefunds.com/contact

@@collegetaxrefunds Is there a number I can reach you on please

@@Htman all of my contact information is at the contact link I gave you.

Thank you for your explanation on the 1098-T. On my form i received from my college i only have amts in box 5. I used very little for school expenses. Am I eligible for any of the credits you mentioned? Also do I still need to report the amt in box 5 as income. This is my first year receiving this form. I’ve read some place that I do not need to include this on my 1040 if I’m not claiming any credits. Please advise. Thank you.

You do not need to report anything on your taxes. I recommend you follow the plan you have outlined.

If the international student is wanting to declare themselves to be a resident of the US and to declare that they will pay US income tax on all their worldwide income, they should talk to a CPA about the future implications of that declaration. Then, they can file a normal 1040 (not 1040-NR) and claim the education credit. If they do not want to be taxed (or chased) by the IRS in the future, I don't suggest international students try to claim US tax credits.

Thanks for watching. I can't answer specific questions about specific individuals without asking lots of questions. Everyone's situation is different. Is there someone who is allowed to claim you as a dependent? Did you provide for more than half of your own total support, including food, rent, transportation, etc.? Is $3,000 the total of your tuition AND books and fees? Does the tax return show that you are getting $1000 for your American opportunity tax credit?

@@collegetaxrefunds No one can claim me as a dependent. $2624 is my tuition and fees stated on my 1098-T and $300 is required books not purchased from the school. Education Credit is $1,339 and Refundable American Opportunity Credit is $892

@@MustLoveDisney this looks correct based on what you've provided

@@collegetaxrefunds ok great. Thank you for your help.

@@MustLoveDisney you're very welcome

Thanks for the question. Yes, you can claim the American opportunity tax credit in 2020 and 2021, as long as you 1) did not complete your first 4-year degree BEFORE the beginning of the tax year (i.e., 2021), 2) were working towards your first 4-year degree as enrolled at least half time for at least one semester, 3) no one has already claimed the American opportunity tax credit for you (4 times is the limit), and 4) you don't have a felony conviction for drug possession.

Thanks for watching and commenting.

Turbo Tax does not know how to claim the education credits when your scholarships and grants exceed your tuition. For this reason, TurboTax will usually cost you at least $1000 in missed tax credits, even if the program is "free." Whoever prepares your tax return needs to include not just the excess scholarships and grants in your income but an additional $2000-4000 more (the amount can be tricky and depends on a number of things). THEN, when you have included enough scholarships in your taxable income, the person who is claiming you as a dependent (or you, if no one else can claim you) will be able to enter your tuition LESS the amount of TAX FREE financial aid on Form 8863. At this point, that amount will be $2000-4000, and that will enable you to claim the American Opportunity tax credit. This entire process is very complicated, but worth up to $2500. If you have additional questions, please contact me directly at SteveHuntCPA at CollegeTaxRefunds dot com (turn that into a standard email address)

The taxable amount depends on several things, like whether your kid is your dependent, your gross income and your kids' gross income, whether any of you qualify for the earned income credit, how much your kid spent on all educational expenses, and more. It's very likely that H&R Block software is doing it wrong, and it's possible you could miss up to $2500 because of the error. I can't answer your question without more information. Please feel free to reach out to me at SteveHuntCPA at CollegeTaxRefunds dot com if you haven't already.

Unfortunately, the answer to this question is extremely complicated. It depends on 1) if you can be claimed as a dependent by someone else, 2) your income, 3) your tuition amount, 4) your scholarships, 5) your earned income credit, and several other factors. If you would like specific help, please email me at SteveHuntCPA at CollegeTaxRefunds dot com.

Scholarships do not get reported on the 8863. After you determine how much scholarship to report in income, they get reported on the same line as Wages on the 1040, and you write the letters SCH in front of the scholarship amount on the dotted line. If you aren't sure how to calculate it or how to report it, there's a good chance the IRS will fight you on it. (They'll fight you on it even if you do it right, because half of the IRS agents don't know about this tax strategy, even though the IRS wrote a paper about it in 2014. www.irs.gov/pub/irs-utl/Pell%2520AOTC%25204%2520pager.pdf )

If you can claim your daughter as your dependent on your taxes, then YOU must claim the education credits on YOUR tax return. However, you only qualify if your income is below $90,000 ($180,000 if married). Additionally, if your daughter's tuition (box 1) is not at least $4000 more than her scholarships and grants (box 5) on the 1098-T, then your DAUGHTER must include some of her scholarship income on HER tax return. Determining the exact amount is tricky, and doing it wrong can cause issues with the IRS or can reduce your family's tax refund. I'm sorry it's so complicated. That's just the nature of this tax credit. If you need additional help, you can send me more information at SteveHuntCPA at CollegeTaxRefunds dot com (turn that into an email address), and I can help you prepare your taxes this year.

You cannot be a dependent of anyone to claim the American opportunity credit. However, your parents can claim the credit and give it to you or split it with you. But, you need to be a qualified enrolled student, and they need to qualify based on their income. Finally, in order for them to claim the full credit, you will need to choose to report $3000-5000 of your grants as TAXABLE on your tax return. If you had no other income, that won't even result in any tax for you. Only then can your parents claim the credit. It's extremely complicated I recommend you reach out to me at Collegetaxrefunds.com/contact

Hi! Thanks for the question. I have several videos that discuss the 1098-T form and how to correctly claim the American opportunity tax credit on your taxes, but I don't have a video "going through filling out a student's taxes." Every student's taxes will be different, and the way you claim the credit will depend on whether you're a dependent or not, whether you're married or not, whether your parents have a high income or low, whether you received the earned income credit, and how your scholarships and grants compare to your tuition. Unfortunately, I would need to make at least 10 videos preparing student taxes to even begin to show how to correctly claim this credit, and then the people watching would have a hard time knowing which video applied to their situation. If you have a specific question and answer you need confirmed, let me know what that is, and I'll do my best to help.

@@collegetaxrefunds Hi, if someone is single, zero dependents, not a dependent Box 1 $9090 and box 5 $28974 how much should I claim as other income? Or can it be any amount as long as you reduce it in the grant amount? Also, is this still necessary if the student worked.

@@ShawSolve In order to accurately answer your question, I will need more information. You may want to email me at Steve Hunt CPA at College Tax Refunds dot com. In order to find the very best answer, I need to know how much your AGI and earned income is, how much your tax and other credits are (including the earned income credit), what your birthdate is, and how much your books and other required education materials and expenses were, whether you have already finished 4 years of college, whether you have already claimed the American Opportunity tax credit 4 times, whether you were at least a half time student during the year, and other things. Without that information, it's likely you'll include too much scholarship in your income (and pay too much in tax) or too little scholarship in income (and not claim the full education credits).

Yes, your parents can claim the American Opportunity tax credit (usually $800-$2500 on their taxes) if you are their dependent. In order to do this, you must request the 1098-T from your university. They should send one if you ask. Then, you must include all of your EXCESS scholarships and grants in YOUR own taxable income on YOUR own tax return, if you are required to file one. You also must include $2000-4000 more than the excess in your taxable income (in the case you've described, it's likely best to include the full $4000). Then, because you reported your excess scholarships + $4000 of scholarships in your taxable income, the IRS "deems" (pretends) that your taxable scholarships were spent on non-qualified expenses, such as housing, food, transportation, insurance, etc. The IRS also "deems" that the assistance provided to you by your parents (if they are providing no assistance, then they cannot legally claim you as their dependent) was actually used to pay for your education. This is why they can then legally claim the American opportunity tax credit. The only way this doesn't work is if your parents make more than the allowable income for the credit.

@@collegetaxrefunds We asked the school for the 1098-t form, they said I wasn’t eligible to receive it because I didn’t pay out of pocket. My financial aid was greater than my tuition, I even got a refund. How can my parents get a tax credit on me when my school won’t provide the form?

@@MichaelSmith-ig6jc I'm sorry I didn't see this note until now. I hope I can still help you. You can email me directly about this at (steve hunt cpa at college tax refunds.com) remove all spaces and change the at to an @. You need to talk to the school bursar or financial office directly and tell them that your CPA says that they CAN still issue you a 1098-T, even though you had scholarships and grants that exceed your tuition. If they absolutely will not do it, your parents are still allowed to claim the American Opportunity Tax Credit, but the IRS will question it. You will have to provide documentation from the school showing the amount of tuition you paid (a receipt or financial statement) AND you will have to correctly calculate the amount of scholarships and grants to include in your own (the student's) taxable income.

You can claim the American Opportunity tax credit when you file electronically. However, it's very difficult to claim correctly if you have scholarships or grants. TurboTax doesn't know how to do it correctly. I'm happy to help you claim the credit this year and previous years. Please email me at SteveHuntCPA at CollegeTaxRefunds dot com

@@collegetaxrefunds it says the email is not valid

@@collegetaxrefunds i got it

I'm not sure I understand your question. FAFSA Pell grants can be included in your taxable income, thus enabling you to qualify for the American opportunity tax credit.

In order to claim the American opportunity tax credit (which you can do a maximum of 4 times), you must have incurred tuition while working at least half time (2-courses at a time) for at least one full semester towards your first 4-year credential or degree. If you did not actually go to school or take classes, you cannot get the credit. If you were required to pay tuition, you should look into the availability of getting it refunded.

I provided my contact information in the pinned comment.

Thanks for watching! There's no reason not to amend. You're just letting the IRS keep your $800-2500. You need it more than they do. Also, I suggest you don't ever use the software you used this year. It cost you $800-2500 to use that software. Good tax prep usually costs $250-500.

I'm hoping RU-vid sends you an email of this comment when I post it, because I'm going to share my email address with you, but I don't want it to remain in the comments of this video. So, I'm going to edit out the email address after I post it. Here it is: [Redacted] Contact me at that address, and I'll see if I can help. If you didn't receive the email address above in an email from RU-vid, post a reply to this, and I'll figure out another way to contact you.

The parent never claims ANY of the scholarship. All taxable scholarships are reported on the student's taxes. Qualified expenses must be reduced by any tax free assistance received. I don't know where to enter it in TurboTax, as I can't stand that program; it causes millions of people to miss thousands of dollars every year. My guess is the taxable scholarship amount would be entered on an adjustments to income screen where there might be a box for "taxable scholarships." If you find it, the scholarship will show up on the dotted line next to "wages" on the tax return. Do not enter the same scholarships into the 1098T screen.

It sounds like you do not HAVE to file a tax return or use your 1098-T. However, if you do not use your 1098-T the way I describe in my videos, it's extremely likely that your parents will have missed a $1000-2500 tax credit (cash refund) every year that you're in college as a dependant.

If you or your parents have additional questions, email me at (Steve Hunt CPA at College Tax Refunds. Com) remove all the spaces. I'll answer your specific questions

@College Tax Refunds I'm sorry for the hesitancy, but for safety reasons I hope you understand and don't take this personally: With all due respect, can I trust you for the help you offer?

@@boiledegg-h1c I understand your hesitancy completely. You can email me from whatever account you want; I'm just going to answer your personal questions about your specific tax situation. You can look be up at cpaverify.org. my name is Stephen Paul Hunt, my Idaho CPA license is CP-5841. You can Google my College Tax Refunds LLC business at the BBB. We are not accredited (which just means we don't pay them the $600 per month they want), but we have an A+ rating And you can watch all my videos to see if I know what I'm talking about. I'm not sure what else to say. 🤷‍♂️ If you think of a way I can get you to trust me, let me know. I tried for 8 years to get people to trust my College Tax Refunds business. When they trusted me, I got them $1300/year back on their taxes on average. But lots of people also didn't trust it. And I get that. Unfortunately, I never figured it out until after my website went down during the pandemic. That was right about when I started making these RU-vid videos. And that's when people finally started to trust me... But now I don't have a website to direct them to. I'm trying to get it rebuilt, but it takes time and money. You do what you feel comfortable doing.

Sorry for the slow response. It's better to email me at Steve Hunt CPA at College Tax Refunds. Com. I think we should discuss your situation specifically. This is a difficult situation. In short, if you include all $2000 in your income, you should be able to claim a small amount of the AOTC, but it might be better to amend other tax returns and claim it in a previous year or in a future year

Thanks for reaching out to me on email. As I mentioned since most Puerto Rican citizens don't file or pay federal income tax, you will not qualify for this tax credit.

What is the number in box 5, and why did you not pay any tuition?

I have the same issue. Box 1 is empty because parents sent the payment I’m Dec of 2020, for spring 2021

@@Sososewist if that's the case, the credit should have been claimed by your parents (if you were a dependent) in 2020. I would have to know a lot more about your tax situation to tell you whether you need to include the scholarships in your income in 2021. From a legal standpoint, it's likely. But from an enforcement standpoint, I'm not sure the IRS will care.

@@collegetaxrefunds thank you so much. I think they make too much for the deduction.

@@Sososewist the phase out begins at $160k

Thanks for the question. Assuming you entered the information from your 1098T into TurboTax correctly, the reason you are not getting a refund is because your parents CAN claim you as their dependent, even if they choose not to. They should claim you as their dependent and enter the 1098T information into THEIR tax return, and if their income is not too high, they will get a larger refund (up to $2500 more), which they might be willing to share with you. If you believe they should not be allowed to claim you as a dependent, please let me know all the ways they financially support you and who pays for your housing, food, transportation, healthcare, entertainment, and everything else, and we can discuss options for you.

@@collegetaxrefunds I am 28 so, I don’t think they can claim me as a dependent. I got married this year so my wife and I are filing jointly. She works full time and I’m in school full time finishing my degree. the combination of her income and my grants/scholarships/loans cover our living expenses. Thank you for the reply and let me know if I have any options.

@@jibberish00 ok perfect. Thanks for your reply. Is there any possible chance that you or your parents claimed the American opportunity tax credit for you in any previous year? This is incredibly important and may require looking at all previous tax returns (yours and your parents') when you were a student. If not, what you need to do is difficult. TurboTax simply doesn't do this correctly for students. You must find the place in TurboTax where you enter TAXABLE scholarships. It might be in a section for OTHER income. Enter there the result of this calculation: Box 5 - Box 1 - total required books + $4000. Then SUBTRACT that exact same number from Box 5 when you enter your 1098T information into TurboTax. If you do that correctly, you should see your taxable income increase by the amount we calculated, and it will say SCH on the wages line of your tax return. You also should see your American opportunity tax credit jump to $1000 and your Education credit jump to as high as $1500. Let me know how it goes. If that's not what happens, OR if your Earned Income Credit drops, OR if you can't figure out how to do what I'm saying, then there is more we need to do together. This is a very challenging area of tax law, and TurboTax just doesn't do it right.

@@collegetaxrefunds I really appreciate the detailed reply. I’ll look into past filings. If I haven’t previously claimed the credit, I think I can follow along with your instructions just as well. I’ll reach out if I have any hiccups. Thanks again!

@@jibberish00 sounds good. You can claim the credit (or any part of it) 4 times total. It's for undergraduate students working on their first 4-year degree who are more than half time students.

You don't NEED the form, but if you pay attention to the videos on my channel, you'll see that you may WANT to ask them for the form. It depends on many factors, like whether you're a dependent, your parents' income, your income, your scholarship amount, etc. In most cases, however, using the 1098T correctly (which is quite difficult and most people use it wrong) will result in an $800-2500 tax refund.

@@collegetaxrefunds thank you

@@Ssamell123 you're welcome. Thanks for the question

Thanks for reaching out. I saw you emailed me. Anyone else can also contact me by emailing SteveHuntCPA at CollegeTaxRefunds dot com

There are several reasons why you might be getting only $6 in the education credit. TurboTax has absolutely no idea how to correctly claim the education credit for students who receive scholarships and grants if the tuition (box 1) is not AT LEAST $4000 more than the scholarships and grants (box 5) on Form 1098-T. If that sounds like you, then the person preparing your taxes needs to do some challenging computations and include the correct about of scholarships and grants into your income in order to enable you or your parents (if they can claim you as a dependent) to claim the education credits. If you have more questions or need additional help, please email me directly at SteveHuntCPA at CollegeTaxRefunds dot com (turn that into a standard email address).

Thanks for the question. You are an independent only if you provided more than half of all of your own financial support with your own earned income. So, if you have a job, and no one else is helping you pay for your housing, food, insurance, transportation, tuition, etc., Then you can claim yourself as an independent. Otherwise, whoever is providing more than half of your financial support can claim you as a dependent

@@collegetaxrefunds Hi Sir Brooklyn here returning here to just acknowledge the help and assistance of undergoing this process for me. With much respect, for your help! I have heard some feedback on going about this and I thank you again🙏🏾!

@@brooklynnyc thanks!

If you have no income, then you don't need to file a tax return. HOWEVER, if someone else can claim you as their dependent on their tax return, and if THEY have income below $90,000 ($180,000 if married) then THEY can use your 1098-T to claim a very valuable education tax credit worth up to $2500. However, if you received scholarships and grants and your tuition (box 1) is not at least $4000 MORE than your scholarships and grants (box 5) on your 1098-T, then it's extremely likely that the person filing their tax return will make a mistake and fail to claim the maximum possible credit. If the people claiming you as their dependent do not receive at least a $1000 American Opportunity Tax Credit, please have them email me at (SteveHuntCPA at CollegeTaxRefunds dot com). Turn that into a standard email address.