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March 25, 2020
Question

Hello, I am a student filing that I can be claimed as a dependant by my mom. I did file my 1098-T. When my mom claims me, does she need to include my 1098-T as well?

  • March 25, 2020
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Hal_Al
Employee
March 26, 2020

Yes. Since you are your Mom's dependent, she is the on who claims the tuition credit or deduction.

 

But, that brings up the question: what exactly did you claim when you "filed your 1098-T"?  As a dependent, you are not eligible to claim a tuition credit or deduction.  But, if your scholarships exceeded your qualified expenses, some of your scholarship (but not loans)  is taxable. 

 

Even if you have more scholarships than expenses, it may be possible for your Mom to claim a credit. See below for details.

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There is a tax “loophole” available. The student reports all his scholarship, up to the amount needed to claim the American opportunity credit, as income on his return. That way, the parents  (or himself, if he is not a dependent) can claim the tuition credit on their return. They can do this because that much tuition was no longer paid by "tax free" scholarship.  You cannot do this if the school’s billing statement specifically shows the scholarships being applied to tuition or if the conditions of the grant are that it be used to pay for qualified expenses.

Using an example: Student has $10,000 in box 5 of the 1098-T and $8000 in box 1. At first glance he/she has $2000 of taxable income and nobody can claim the American opportunity credit. But if she reports $6000 as income on her return, the parents can claim $4000 of qualified expenses on their return.