I am doing my sons taxes . For 2017 he received a 1098T that lists 4246 in Box 2 and 5637 in Box 5…He entire college bill for 2017 was 9458 and covered in full by his TGTP fund and Scholarships and grant . TGTP paid 4349 toward entire tuition and fees and Scholarships and grants paid 5073 toward rest of bill which happened to be listed as dorm room and meal plan, an orientation feee and IT fee. He was left with a small balance and paid the 36.00 of his own money for his 2017 college bill. I am needing to figure out what portion does he owe taxes on?
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is the 1098T correct?
You said TGTP paid $4,349 for tuition and fees, but box 2 (qualified tuition and fees billed) has an amount of $4,246. So does that mean that $103 of fees was considered nonqualified? -
is the TGTP a 529 account?
https://www.tgtp.org/1099Q.html
It seems like it is
If the qualified tuition and fees amount of $4,246 was paid by tax advantaged 529 funds, then I think he would have to report the whole $5,367 in scholarships and grants as taxable income on his tax return.
Did he have book expenses?
The TGTP paid out 4349 to the school for tuition and fees the 1098-T list 4246 in box 2 so I assume it is incorrect.
Yes the TGTP is a 529 known as Texas Guarenteed Tuition Plan
Yes he paid for his books with his own money around 500
Appreciate any help!
The TGTP paid out 4349 to the school for tuition and fees the 1098-T list 4246 in box 2 so I assume it is incorrect.
Yes the TGTP is a 529 known as Texas Guarenteed Tuition Plan
Yes he paid for his books with his own money around 500
Appreciate any help!
Alright. Total of scholarships and grants can be reduced by book expenses to determine taxable amount (tuition and qualified fees has already been covered by TGTP).
Or might you qualify for AOTC?
https://www.irs.gov/credits-deductions/individuals/aotc
Then you could claim the book expenses instead towards a $500 AOTC, if you claim your S as a dependent on your taxes.
My D’s school did not list all fees in box 2 of 1098T, because some are considered nonqualified.
Did you look at the tuition bill and see if he had a health fee or something for $103?
Or you can call the school and ask why the amount in box 2 is lower than the tuition and fees paid by TGTP.
What was the amount of other scholarships and grants? Could those add to $4246? If the TGTP is the same as a 529, it may not show on the 1098 at all.
How I do my daughter’s is to get out the tuition bill and credits. I add the tuition, fees, and books (the QEE). Then I add all the grants and scholarships and do the math. She pays taxes on the difference. Never has the 1098-T been correct because of the school billing tuition in Dec but not awarding the scholarships until Jan, and I keep everything in the same tax year. We don’t have a 529 plan so if any of her schol/grant money is used for room and board, she’s taxed on it.
Ok so if I don’t go by the 1098-T … Yes I have done the math and his entire tuition bill for 2017 was 4349 …the portion for dorm meal plan and IT fee and orientation fee was 5109 total bill was 9458.63 … TGTP pays first so it paid 4349 toward qualified tuition and fees which left a balance on his bill of 5109.63 … then Scholarships and grants paid 5073.00 which left a balance of 36.63 which my son paid. My son also paid for books totaling 500 dollars from his own money.
I’m wondering if the 4349 amount paid for tuition and fees by the TGTP can be claimed as AOTC?
No, the TGTP money is already ‘tax benefited’ so cannot be used to claim the ATOC unless your son pays taxes on it.
Some fees are part of QEE. My daughter paid studio fees, computer fees, etc and those are QEE. Transportation, insurance, football tickets etc are not IF they are separated out of the student fees. DD#2’s school just charges two general fees and they are part of QEE
So you are saying the box 2 amount on the 1098T is incorrect?
But you don’t know for sure?
And the box 5 amount is also incorrect?
Because it lists total scholarships and grants as $5,367, not the $5,073 you said paid for room and board.
So have you actually added up all of the tuition and qualified fees on the tuition bill and all of the scholarships and grants?
Student transportation fee and health fee at my D’s school are not listed as part of qualified fees on the 1098T because they are considered nonqualified, but that is correct.
That’s why I said you might want to ask the school about that.
https://www.tgtp.org/1099Q.html
Quote from the above link:
Ok I have my sons itemized school bill that lists out every fee where is the list that determines which ones ar QEE.?
Yes it the 1098-T is incorrect as I have the TGTP statement in front of me stating they paid 4349 to the school . And box 5 is incorrect because I have the financial aid award letter in front of me stating 5073 as his scholarships and grants. This is sooo confusing but I truly appreciate everyone’s help!
Did you look through Publication 970?
Here is some info regarding qualified fees for AOTC:
https://www.irs.gov/credits-deductions/individuals/education-credits-questions-and-answers
Yes I did … I also put info into tax act and it’s giving me a 2500 AOTC… I think it is incorrect and doesn’t realize the tuition and fees portion was paid with TGTF funds .
So I’m concluding that I will list all the 5073 scholarship and grant money that went toward room and board as taxable income on my sons taxes then I will claim the 500 spent on books as AOTC . I won’t worry about asking for a new 1098-T as I have his itemized bill here. He will have to file a tax return due to his work income earned from his job and scholarship and grant money awarded … equaling more than the standard deduction of 6350 .
Dom’t worry about trying to match the numbers on the 1098. I was a volunteer tax preparer and we were told that the 1098 is merely a starting point.
Make your own spreadsheet, chart, or notes. Keep copies of everything. Imagine that you are showing an auditor how everything was paid for. For instance, have a copy of the bill and a copy of the 529 withdrawal.
QEEs are listed in Pub 970. Or do a search at irs.gov. Total up QEE and subtract what the 529 paid. The difference is taxfree. All scholarships and grants above QEE are taxable.
If you use one of the free online tax programs, it will walk you through this question by question. If you want to be certain, you can do a doublecheck using a different vendor. Your son should certainly qualify for free tax prep even if perhaps you don’t. Always start at irs.gov to get the best offers and to know they are legit.
There are some ways that you or he may qualify for a tuition tax credit, but I will suggest you check other threads that have gone into that in detail. Can be VERY complicated. It looks to me that in your case the potential credit would be very small. The tax program you use may offer guidance.
They won’t give you a new 1098-T as they are reporting what they have and what they received. An example is my daughter had a $2000 outside scholarship her first year. The check was sent to us, but we reported it to the school. That $2000 did not appear on her 1098-T, not did any money we just paid them (not covered by scholarships). The school doesn’t know if that money came from a 529 account or not. The 1098=T reported tuition and fees, and then the amount of grants either the school granted or that were paid to the school (we had a few state grants paid to the school). The 1098-T didn’t worry about what was only for tuition or what could be used for r&b, it just reported the total.
On TaxAct, there should be a question about funds paid by other tax benefited accounts, like a 529, and should also ask about books or other supplies that are QEE. Sometimes you have to reread the questions a few times to know where to put the numbers in. If I remember, it asks for the 1098-T numbers and then asks if those are correct. If you check NO then you can put in your own numbers.
I think you should add up all the tuition and fees and books and enter that number. Then enter the scholarships and grants. If there is some QEE ‘left over’ you can use that for AOTC, and then you can decide if you want to declare any of the TGTP taxable in order to take more AOTC
I would call and ask the school about the 1098T and why it has lower amount for qualified tuition and fees listed than tuition statement, and higher scholarships and grants amount.
Was there a question about QTP in the education interview in Taxact?
If the scholarships and 529 plan rules allow, the scholarships should go first for tuition, qualified fees and course required material (books, etc.), and then the 529 money should go towards the room and board amount as set by the school. This will probably reduce as low as possible the amount that is subject to tax.