TWO FORMS 1098-T

Forum|Forum|1 year ago
February 21, 2025
2 replies
0 views

Hi. My son 19 is student and has two forms 1098-T and a W-2 around $4200.

One 1098-T just has tuition amount no scholarship number and the other on has $12000 tuition and box 5 is $19500. Can I take the first one on my tax return the second one goes to his tax return + his W-2?

Thanks

Hal_Al

Employee

Q. Can I take the first 1098-T on my tax return the second one goes to his tax return?

A. Yes, you can, but it's probably not best.

A 1098-T can go on both the parent and student's tax return, if needed.

You don't say how much tuition is on the first 1098-T. You only need $4000 to claim the American Opportunity Tuition Credit (AOTC). That means the rest of the tuition (on the first 1098-T) can be used by him to reduce how much of the scholarship is taxable. Yes, tuition from one school can be allocated to scholarship from a 2nd school, for tax purposes. If the 1st 1098-T has less than $4000 in box 1, you want to claim some of the tuition from the 2nd 1098-T for the AOTC, even if he has to pay a little more tax on the scholarship. The AOTC is 100% of the 1st $2000 and 25% of the 2nd $2000.

The TurboTax (TT) interview can handle this situation (2 1098-Ts split between two tax returns) but it can get tricky. Short cuts can be used. Reply back if you need detailed help.

MANI1346Author

I think you did not read correctly my question you have some typo. First one of 1098-T just have a number for tuition. The second one has tuition less than scholarship number. Can I take the first one for my tax return to take AOTC and the second one goes to son tax return +his W-2?

$4200 was for W-2 not for AOTC, I totally did not understand but thanks.

you said: A 1098-T can go on both the parent and student's tax return, if needed.

A 1098-T should be on my return or my son return, never goes in both return.

Hal_Al

Employee

I didn't misread it. The $4000 for the AOTC is separate from the W-2. But, thanks for the point out. I didn't address an issue:

Q. Does your son even need to report any of this?

A. No, unless he needs to file a tax return to get his W-2 withholding refunded. $19500 scholarship minus $12000 tuition = $7500 taxable scholarship. $7500 + $4200 (W-2) = $11,700 total income. This is less than the $14,600 filing requirement. He does not need to file a tax return.

The 1098-T is only an informational document. The numbers on it are not required to be entered onto the student's tax return.

If the amount in box 1 of the 1st 1098-T is $4000 or more, you can report only the that one 1098-T on your tax return. The 2nd one isn't needed. $4000 of tuition is all that is needed to get the maximum AOTC ($2500).

"A 1098-T should be on my return or my son return, never goes in both return".

That's not true. The 1098-T is only an informational document. The numbers on it are not required to be entered onto your tax return. However receipt of a 1098-T frequently means you are either eligible for a tuition credit and/or the student has taxable scholarship income. The 1098-T is used as an entry tool to do either or both, when needed.

Hal_Al

Employee

We've explained a lot of the whys and wherefores of your situation, but to simplify the answer to your basic question:

Q. Can I take the first one on my tax return the second one goes to his tax return + his W-2?

A. It depends on how much is in box 1 of the first 1098-T. If it is more than $4000, yes you enter only the first 1098-T on your return. On his return, he enters both of them and follows the interview. In particular, be on the lookout for a screen “education expenses used for a tax credit”. It will usually be prepopulated (sometimes with $10K instead of the more appropriate $4K). You can change it for the amount you want to allocate to the AOTC, $4000 in your case. .