1098-T Tax Form FAQs

The 1098-T form is used by eligible educational institutions to report information about their students to the IRS as required by the Taxpayer Relief Act of 1997. Eligible educational institutions are required to submit the student's name, address, and taxpayer’s identification number (TIN), enrollment and academic status. Beginning with 2003, educational institutions must also report amounts to the IRS pertaining to qualified tuition and related expenses, as well as scholarships and/or grants, taxable or not. A 1098-T form must also be provided to each applicable student. This form is informational only. It serves to alert students that they may be eligible for federal income tax education credits. It should not be considered as tax opinion or advice. While it is a good starting point, the 1098-T, as designed and regulated by the IRS, does not contain all of the information needed to claim a tax credit. There is no IRS requirement that you must claim the tuition and fees deduction or an education credit. Claiming education tax benefits is a voluntary decision for those who may qualify.

In January of each year, National-Louis University mails an IRS Form 1098-T to all students who had qualified tuition and other related educational expenses billed to them during the previous calendar year. This form is informational only and should not be considered as tax opinion or advice. It serves to alert students that they may be eligible for federal income tax education credits. Receipt of Form 1098-T does not indicate eligibility for the tax credit. To determine the amount of qualified tuition and fees paid, and the amount of scholarships and grants received, a taxpayer should use their own financial records.

NOTE: It is up to each taxpayer to determine eligibility for the credits and how to calculate them.

Yes. Section 6050S of the Internal Revenue Code, as enacted by the Taxpayer Relief Act of 1997, requires institutions to file information returns to assist taxpayers and the Internal Revenue Service in determining eligibility for the Hope and Lifetime Learning education tax credits. Forms are mailed at the end of January of each year for the previous tax year.

For more information about qualified educational expenses please go to: http://www.irs.gov/publications/p17/ch35.html#d0e74760.

The IRS instructs institutions to report either payments received (Box 1) or amounts billed for qualified tuition and related expenses (Box 2) on the 1098-T. Once an institution has selected one of these options, they cannot change reporting methods between calendar years without IRS permission. NLU reports qualified tuition and related expenses that were billed during the tax year (Box 2) and scholarships and grants, therefore, Box 1 – Payments Received for Qualified Tuition and Related Expenses, will be blank.

While it is a good starting point, the 1098-T, as designed and regulated by the IRS, does not contain all of the information needed to claim a tax credit. Most of the information needed must come from the student's personal financial records of what the student paid during the calendar year. Additionally, each taxpayer and his or her tax advisor must make the final determination of qualifying expenses.

For an overview of the Hope Credit, Lifetime Learning Credit, and allowable tuition and fee tax deductions visit http://www.irs.gov/faqs/faq/0,,id=199791,00.html. Not all students who pay qualified expenses are eligible for a tax credit. For example, both credits have an income cap. Students who have a Modified Adjusted Gross Income (MAGI) greater than or equal to $60,000, or $ 120,000 for those filing a joint return, are not eligible for the Hope or Lifetime Learning credit.

Chapter 35 of IRS Publication 17 provides a very clear explanation of the eligibility requirements and filing instructions for the Hope Credit and the Lifetime Learning Credit. You can access an electronic copy of this chapter at http://www.irs.gov/publications/p17/ch35.html. The information provided may help you determine if you may be eligible for a tax credit. If you are eligible for both, it will help you decide which to claim. Each student can only claim one of these tax credits per year. You are also prohibited from claiming a tuition and fees deduction and an education tax credit for the same student for the same year. Publication 17 includes a number of useful real-life examples. Publication 970 explains tax benefits for education: http://www.irs.gov/publications/p970/index.html.

The maximum credit per student is $2,500 and it is available for the first 4 years of postsecondary education. Forty per-cent of the credit is refundable for most taxpayers. Students cannot claim this credit if their MAGI is $90,000 or more ($180,000 or more if filing a joint return). For more information please visit http://www.irs.gov/publications/p17/ch35.html.

Yes. Loan funds should be considered in the same manner as cash payments when calculating a Hope or the Lifetime Learning Tax Credit or the Higher Education Tuition and Fees Deduction. However, any scholarships, grants, or other non-taxable aid must be deducted from the amount of qualified tuition and related expenses paid. The credit is claimed in the year in which the expenses are paid, not in the year in which the loan is repaid.

No. You cannot claim a credit for the amount of higher education expenses paid for by tax-free scholarships. For more information, please visit the IRS website.

No. The address shown on Form 1098-T is irrelevant for IRS income tax filing purposes. The single most important information on the form is your Social Security Number. Please call (800) 443-5522 extension 5878 if the SSN on your 1098-T is incorrect.

Account statements are available online at http://my.nl.edu. Follow this path My Services -> NLU Self Service -> Student -> Student Records -> Account Summary by Term to retrieve your account summary.

The NLU Federal Identification Number is 36-2167804. This number can also be found on the 1098-T form in the middle left section.

If you have additional questions/concerns you can reach us

• by Email: StudentFinance@nl.edu 
• by Phone: 800.443.5522 x5878
• IRS Tax Info: 800.829.1040