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How to Fill Out the Education Tax Forms

1098-T and Education Expenses

Think of our 1098-T and Education Expenses screen as one-stop-shopping for most education credits and deductions. You’ll find the American Opportunity credit, the Lifetime Learning credit, and the tuition and fees deduction all on this one form. For each student, though, you have to choose just one of the three. (We cover the choices more thoroughly in Tuition Deduction vs. Education Credit.)

If you accidentally choose more than one credit, we’ll use the one that helps you the most.

Tax Law Update: The tuition and fees deduction lapsed at the end of 2017, and has not yet been extended for 2018 returns.

Getting Started

Let’s walk through how to fill out this form.

Education tax breaks are student-specific, so at the top of the screen, you’ll need to select the appropriate student. If the student is not available in the list, that means the student has not yet been added as a dependent on your return. So for a child, you need to first fill out the Dependent screen.

Next are one or more questions that determine whether you can claim the American Opportunity Credit or the Lifetime Learning Credit. Additional questions may appear, depending on your answers.

Filling in Amounts

Just provide information from your school, which you can find on a Form 1098-T from the school.

You should provide information for each school the student attended. If the student attended three separate colleges during the year (and claimed expenses from all of them), you’ll need to fill out a screen section for all three. If you need to add another college, click the link, “Add another educational institution.”

Near the bottom of the screen is a field where you can adjust your modified adjusted gross income (MAGI). This could be needed if you’re also reporting Foreign Earned Income using the Form 2555-series or on Form 4563.

There are also a few checkboxes some taxpayers may find useful. One is to denote that the taxpayer is the dependent of another, but that person is not claiming either the exemption or the education credit. If that applies to you, checking this box could let you still claim a credit, provided you qualify otherwise.

The last checkbox on the form denotes that all the expenses entered are for an undergraduate degree only. This is necessary on some state returns, but is not needed on federal tax returns.

What About Student Loan Interest?

That goes on our screen for Schedule 1 for Form 1040. Don’t worry, our tax return interview will help you fill out the right screens.

Also see:
Tuition Deduction vs. Education Credit
How to Deduct Student Loan Interest

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