Useful info for 1098-T

mcat2
Mon, 28 Mar 2016 22:13:54 +0000

Except for those who might need to link their taxes to the FAFSA IRS data retrieval tool for college financial aid purposes. Best not to wait until April 18 to file…since it can then take another week…or two to be able to link…and that is getting close to or after deadlines for filing at some schools. And yes, I know the initial filing can be done with estimates…but if one is selected for verification after DRT link…and that doesn’t happen until,after April 18…it has the potential to delay financial aid.

These are all very good reminders.

Re: DRT…It used to make us nervous just because we started to file the tax return, FAFSA, etc., a little bit too late and we had a concern about potentially running out of time. It is better to be early than late.

The issues about 1098-T and its relationship to education related credits or deductions) and 529 used to consume a lot of our energy also.

I have never had enough patience to sit down and read all paragraphs in IRS Publications 970. (maybe not even any IRS Publications!) However, this short paragraph in Publication 970 is relevant to the “educational credit” topic here:

“The lifetime learning credit is based on qualified education expenses you pay for yourself, your spouse, or a dependent for whom you claim an exemption on your tax return. Generally, the credit is allowed for qualified education expenses paid in 2015 for an academic period beginning in 2015 or in the first 3 months of 2016.”

So the qualified education expenses paid in the first 3 months of 2016 (which you need to dig out from your school’s account history, and is likely not included in the 1098-T (for the tax year 2015) which you received from the school at the end of January in 2016) are for the tax return year 2015.