1098T FAQ
General Information
Please also access our Frequently Asked Questions for additional information.
The Form 1098T provides you with your amounts paid for qualified tuition and related expenses, and the scholarships and grants which may reduce the amount of the education credit you can claim for the specified calendar year. Please keep in mind that receipt of Form 1098T does not guarantee eligibility for any of the tax credits. You must read the eligibility requirements to determine if you qualify. For more information about Form 1098-T, click this link.
Depending on your income (or your family’s income, if you are a dependent), whether you were considered full or half-time enrolled, and the amount of your qualified educational expenses for the year, you may be eligible for a federal education tax credit. (You can find detailed information about claiming education tax credits in IRS Publication 970,)
The dollar amounts reported on your Form 1098-T may assist you in completing IRS Form 8863 – the form used for calculating the education tax credits that a taxpayer may claim as part of your tax return.
The University of Scranton is unable to provide you with individual tax advice, but should you have questions, you should seek the counsel of an informed tax preparer or adviser.
Tax benefits relate to "qualified education expenses" which were paid via "qualified payments" during the 2024 calendar year. The IRS describes qualified education expenses as mandatory charges required for enrollment at an eligible institution. Non-qualifying related expenses and charges include room and board; fees involving athletics and insurance, transportation and similar personal or living expenses. The IRS defines qualified payments as those made "out-of-pocket" including from student's earnings, a loan, a gift, an inheritance or personal savings. Non-qualifying payments are included in the scholarships and grants box 5 on your Form 1098T. These payments include those made from a Pell Grant or any other tax-free grant or scholarship, a tax-free distribution from an education IRA or a tax-free distribution from an employer-provided educational assistance program.
We strongly encourage you to obtain IRS Form 8863, which is the form that must be filed to claim the education tax credits. The instructions for Form 8863 provide useful information that is helpful in determining the best way to proceed to maximize tax benefits. The form can be printed from the IRS general website listed in this memo.
Please also access our Frequently Asked Questions for additional information.
Summary
Certain laws and regulations provide opportunities for tax savings regarding payments for tuition and other qualified expenses for attending post-secondary education. It is important that you understand the particular provisions of each of these credits or deductions so that you can make the best decision for your particular circumstances. The University of Scranton can not advise you as to which credit or deduction is best for you. Due to the complexity of these laws, it may be beneficial to consult with a tax preparer to help you make the most informed decision.
We recommend that you take the following steps.
- Read the above information and access the websites listed below to learn more about the details of the higher education tax provisions. IRS Publication 970 is an excellent resource to use. Consult with professional tax advisors if necessary.
- Review your Form 1098T for your qualified payments and scholarships and grants.
- Access your accounts details in order to determine "qualified tuition and related expenses."
- Determine which credits are applicable based on the enrollment status of the student.
- Maximize tax benefits based on the student and family circumstances.
The web addresses and phone numbers in the right hand column may provide you with additional information and may help you better understand the tax laws and regulations.