Am I truely ineligible for a tax credit?

Forum|Forum|2 years ago
February 9, 2024
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I am submitting my 1098-T forms, and it is saying I am ineligible for an education tax credit.

My first 1098-T for my last semesters of undergrad is as follows:

Box 1 [Payments received for qualified tuition and related expenses]: $6077.50

Box 5 [Scholarships or grants]: $23,845.00

I recognize that because box 5 is greater than box 1, that I am ineligible for an education tax credit, however, it should be noted that the $23,845 in scholarships were used to pay for the spring 2023 semester ($23,085 in tuition) which I was charged for in November 2022. As such, the spring 2023 tuition expenses were included on my 2022 1098-T. The $6077.50 is comprised of my summer 2023 semester tuition and some carry-over expenses from 2022. I did not have any scholarships for the summer 2023 semester.

I also have a second 1098-T for my first semester of grad school, however, it is not as relevant as I only had $330 of expenses and $0 of scholarships.

Is there a way to salvage a tax credit from this?

TurboTax Free Edition Online

AmyC

Employee

Maybe. If you did not use those expenses on your 2022 return, you can use tuition paid the last 3 months of 2022 for 2023 along with your 2023 expenses, undergrad and grad since you had not yet graduated.

As long as you have the records and can prove the amounts claimed, you are good to go.

See page 12, What Expenses Qualify at IRS Publication 970, Tax Benefits for Education..

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