What is the 1098T tax form used for?
An eligible educational institution, such as a college or University in which you are
enrolled, and an insurer who makes reimbursements or refunds of qualified tuition and
related expenses to you, must furnish this statement to you. You, or the person who can
claim you as a dependent, may be able to claim an education credit on Form 1040 or
1040A for the qualified tuition and related expenses that were actually paid in 2009.
How can I obtain more information on how this will assist me with filing?
Your institution must include its name, address, and information contact telephone
number on this statement. It may also include contact information for a service provider.
Although the service provider may be able to answer certain questions about the
statement, do not contact them or the filer for explanations of the requirements for (and
how to figure) any education credit that you may claim. For more information about the
credit, see Pub. 970, Tax Benefits for Education; Form 8863, Education Credits; and the
Form 1040 or 1040A instructions.
Why doesn’t my 1098T match what I Paid/Received?
This is the most common misunderstanding each year. Institutions may report either
payments received in box 1 or amounts billed in box 2. U of D has chosen to report Box
2 – amounts billed. For 1098-T purposes, University of Delaware reports qualified
transactions in the calendar year when amounts were billed and not when amounts
were paid, received or posted. For example, undergraduate students were billed mid-
December 2009 for classes being taken during the Spring semester 2010, so those
amounts are included on your 2009 1098T.
What charges make up Box 2 (Amounts Billed for Qualified Tuition and Related
Amounts of qualified tuition and required fees reported on your 1098-T are defined by
the IRS as tuition and fees required for enrollment or attendance at an eligible
educational institution. This amount includes tuition, registration fee, comprehensive
fee, student center fee, new student orientation fee, clinical course fee, student teaching
fee and general fee. The IRS does not consider student health fees, transportation
fees, insurance fees, or room and board of any kind as qualified tuition and related fees,
therefore, these fees are excluded from amounts reported on the 1098-T.
What is the purpose of reporting information in Box 5 (Scholarships or Grants)?
Amounts of scholarships reported on your 1098T are for determining eligibility for the
Hope credit and lifetime learning credit only, NOT for determine taxability of such
scholarships. Your scholarships may or may not be taxable. Refer to IRS publication
970 http://www.irs.gov/pub/irs-pdf/p970.pdf for details on determining the taxability of
different types of scholarships.