Does box 5 on 1098t affect adjusted gross income? Is that box taxable?

Forum|Forum|6 years ago
March 21, 2020
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TurboTax Deluxe Online

Hal_Al

Employee

Q. : Does box 5 on 1098-T affect adjusted gross income?

A. Maybe

Q. Is that box taxable?

A. Maybe

If the amount in box 5 exceeds the amount box 1, the difference is potentially taxable to the student (not the parent).

But, the difference may be reduced by other qualified expenses, tuition and fees not shown in box 1, books and other course materials.

NCPERSON1

Box 1 can only include "tuition and related fees"

from publication 970:

"qualified education expenses are tuition and certain related expenses required for enrollment or attendance at an eligible educational institution.

Related expenses. Student activity fees are included in qualified education expenses only if the fees must be paid to the institution as a condition of enrollment or attendance. However, expenses for books, supplies, and equipment needed for a course of study are included in qualified education expenses whether or not the the materials are purchased from the educational institution.

so for example, if the book(s) or computer wasn't required for a class, it can't be included. My suggestion is for anything you add to Box 1, be able to support the requirement (e.g. syllabus would be a good supporting document) if the IRS were ever to come knocking.

kirstenkeefe10Author

So in my situation I graduated May 2019 as was a full time student through then. I am now using turbo tax to file my own return and have $9,000 in my box 5 on 1098 T but my parents paid $9,400 in tuition and fees for me through May 2019. So should I be able to include the $9,400 in tuition they paid as a deduction? and if so i am trying to find in turbo tax where to put that information

NCPERSON1

nope - doesn't work that way. you can't deduct what they paid.

please confirm that $9400 is in Box 1.

can your parents still claim you as a dependent in 2019? did they provide over 50% of your support? How old are you? How much you earned is immaterial to whether you CAN BE a dependent of theirs... if they can , it maybe more advantageous for them to put the 1098T on their tax return,