Box 1 of the 1098-T includes an amount for the Spring 22 semester. It was not paid by the VA until Jan 2022. This amount was not included in box 5. Is this correct?

Forum|Forum|5 years ago
April 15, 2021
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Box 1 includes Fall 2021 and Spring 2022 qualified education expenses received by the school. However, the spring half of that was not paid to them until January 2022

Box 5 includes Fall 2021 VA payment and Fall 2021 scholarship.

The Spring 2022 VA payment was not made until January 2022. The spring scholarship was not paid until January 2022.

Was this reported correctly?

Because the amount in scholarships and grants (box 5) is less than the payments received, TurboTax qualifies us for the American Opportunity Tax Credit. However, since the VA covered 100% of his qualified education expenses, we do not qualify for education credits.

Can you help me ensure I report this correctly?

(I believe his scholarship will count as taxable income, as the VA covers 100% of his tuition and fees. The Spring 2022 payment was not included in box 5, either.)

Thanks in advance!

TurboTax Premier Online

KrisD15

You are correct.

The school should not have reported the payment if it had not posted in 2020, unless they are reporting what was paid by the scholarship;

Regardless, you should include the VA payment for 2020, even if it is not reflected on the 1098-T.

The VA payments must be applied to the tuition, scholarships may be claimed as taxable income by the student.

According to the IRS:

“Refunds received after 2020 but before your income tax return is filed. If anyone receives a refund after 2020 of qualified education expenses paid on behalf of a student in 2020 and the refund is paid before you file an income tax return for 2020, the amount of qualified education expenses for 2020 is reduced by the amount of the refund. “

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