1098-T Question

[ForeignBody]

I have read the IRS website and cannot figure this out. I just finished med school, now in residency. I am doing my own taxes and would like to use the Lifetime Learning Credit. The problem is I did not receive a 1098-T for the January-May 2009 academic period. The last one before I graduated. I asked my school and they told me that they bill my account in December 2008, so I dont get a 1098-T for the January-May 2009 period. Is this right?






Do I qualify for the Lifetime Learning Credit?


Eligibility requirements

TurboTip:TurboTax determines if you are eligible for the Lifetime Learning Credit when you go through the Interview flow. The TurboTax Education Optimizer calculates the education credits and deductions for you and selects the combination that saves you the most money.

- The student must be yourself, your spouse, or a child whom you claim as a dependent on your tax return.

- The academic period must begin either during 2009 or during the first three months of 2010.

- You must pay the expenses during 2009.

- You can pay expenses with a loan, including low-interest student and government subsidized loans, but be sure to deduct the expenses rather than the loan payments.

- The student must be taking courses designed to gain or improve job skills, or courses that apply to a degree, certificate, or other recognized credential.

- Qualified education expenses include tuition and required fees associated with enrollment or attendance.

- You can deduct additional fees, such as books, supplies, activity fees, and so on, only if you must pay them directly to the institution as a condition of enrollment or attendance.

- Courses must be taken at an eligible educational institution. Check with your school to see if they are eligible to participate in a student aid program administered by the Department of Education.

---

Members don't see this ad.

 

[Twitch]

You are c/o 2009. Your last academic year was 2008-2009. As far as turbo tax goes, Academic year = academic period. That means you can claim it for 2008 taxes, but not for 2009 taxes.

However, you can deduct job hunting (aka residency interviewing) travel expenses. The reason why you can deduct this and not medical school interviews (way back when) is because for residency you are actually looking for a job (they pay u janitor salary VS you pay them gobs of $$ @ medical school).

 

[dpmd]

However, you can deduct job hunting (aka residency interviewing) travel expenses. The reason why you can deduct this and not medical school interviews (way back when) is because for residency you are actually looking for a job (they pay u janitor salary VS you pay them gobs of $$ @ medical school).

Umm, this is not at all correct. Please look at the IRS website to confirm that you can't deduct expenses looking for your first job in a new field.

As for the lifetime learning credit, the IRS likes to lump the academic year into the tax year it starts. Unless your school is cool and bills you in january (so you pay tuition/loans disburse in january) then you are unable to legitimately claim the lifetime learning credit. Could you try it and hope you don't get audited, of course. Many people probably do that. As long as you can handle the interest and penalties if you get caught, and you don't mind being a tax evader

 

[Twitch]

Umm, this is not at all correct. Please look at the IRS website to confirm that you can't deduct expenses looking for your first job in a new field.

As for the lifetime learning credit, the IRS likes to lump the academic year into the tax year it starts. Unless your school is cool and bills you in january (so you pay tuition/loans disburse in january) then you are unable to legitimately claim the lifetime learning credit. Could you try it and hope you don't get audited, of course. Many people probably do that. As long as you can handle the interest and penalties if you get caught, and you don't mind being a tax evader

👍 Good catch on the first job (residency). For residency you cannot deduct, but the second job (fellowship/attending) you can.

 

[AMDFAO]

Schools have a choice of sending out 1098 Ts with either amounts billed or amounts paid. Most schools simply send it out with amounts billed which is pretty much a useless piece of information to figure a deduction/credit that is based on amounts paid.
To clarify, the IRS only cares about what you actually paid (less any scholarships) when figuring out if you are eligible for a credit or deduction (see IRS Pub 970 or form 8863). I'd take a stab at the fact that your school billed you in 2008 but most likely your loans posted in 2009. My suggestion is you contact the school and request a printout of your billing history to show when the items were paid (each charge and credit will be listed line item).
Several months ago I tripped over an article about the 1098 T in which an IRS auditor essentially stated it would never be enough to prove in an audit much of anything. You'd think accountants would know that but they seem rabid on a 1098 T for some reason.
All of my graduating kids receive a printout of their entire bill to use for the calculating of any deductions or credits in case they are audited later because a bill from the school is what the IRS would use as suitable evidence and not the 1098 T. I also know that my school only sends what's billed and most of the time, that's not even correct.
Truth be told, most schools want the form eliminated and now have a greater reason to push the agenda: they aren't even good enough for the IRS.