MY 1098T form is making me owe money, I thought it's supposed to give me a tax break.

Forum|Forum|6 years ago
June 4, 2019
1 reply
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The amount of scholarships and grants, box 5, was greater than the amount billed for qualified tuition and related expense, box 2. Is this what would cause me to have to pay taxes?

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rainydaze

Employee

Scholarships/Grants that exceed the amount of qualifying educational expenses become taxable income to the student. For example, if your scholarships and grants are $10,000, but your qualifying educational expenses are only $7,000, you would owe taxes on the remaining $3,000.

Keep in mind qualifying amounts are for tuition and fees, books, equipment - room and board as well as transportation are not considered qualifying education expenses.

mitchem99

You do realize room and board are either the first or second biggest expense while in college? The fact that they are not considered qualifying educational expenses is preposterous since shelter on or near campus is a prerequisite to attending college. Due to its omission in the tax code, the gap between scholarships, grants, etc., and the tuition and fees makes poor, immensely indebted students pay even more taxes after doing the 1098-T form a lot of the time; when in reality, all their scholarships and grants went to expenses related to college, which are housing, tuition, and other miscellaneous fees charged to us for events and services on campus. So in truth, there is no gap between the two boxes in real life as they are on the paper so that there should be no extra taxation of students. Colleges make sure they do not give us more money than we need to break even.

NCPERSON1

@mitchem99 - cool down! First, the IRS doesn't pay for personal shelter or food, even if you are employed - it's just the way it is.

even if Box 5 exceeds Box 1, that doesn't necessarily mean it will cause you to pay tax. It depends on your income situation. If your total income is under $12,200 (I assume you are single and not a dependent of your parents), there is no tax in any event!