This information is to assist you in understanding the Form 1098-T you may have received in the mail from the seminary, or what your options are if you did not receive the form.
The following information should not be construed as tax advice. The amounts and calculations used to determine the credit are the decision of the taxpayer after consideration of relevant IRS regulations, Form 8863, and perhaps, the advice of a tax consultant.
An eligible educational institution, such as a college or university in which you are enrolled, and an insurer who makes reimbursements or refunds of qualified tuition and related expenses to you must furnish this statement to you. You, or the person who can claim you as a dependent, may be able to claim an education credit on Form 1040 or 1040A for the qualified tuition and related expenses that were actually paid in the tax year. Institutions may report either payments received in box 1 or amounts billed in box 2. Faith Evangelical Seminary reports amounts billed in the tax year in box 2, which may represent an amount other than the amount actually paid in the tax year (as students may still owe a balance of this amount). If an outstanding balance from one tax year still remains when reporting for the Form 1098-T in the subsequent tax year, any amount unpaid from the tax year will be reported box 4 on the subsequent year’s Form 1098-T which shows any adjustment made for a prior year for qualified tuition and related expenses that were reported on a prior year Form 1098-T. This amount may reduce any allowable education credit that you claimed for the prior year.
Your institution must include its name, address, and information contact telephone number for the filer and service provider. Although the service provider may be able to answer certain questions about the statement, do not contact them for explanations of the requirements for (and how to figure) any education credit that you may claim. For more information about the credit, see Pub. 970, Tax Benefits for Education, Form 8863, Education Credits, and the Form 1040 or 1040A instructions.
Form 1098-T has been provided to assist in determining if you, or the individual who may claim you as a dependent, are eligible to claim the American Opportunity Tax Credit on your income tax return.
The seminary prepared the 1098-T forms based on the information provided by the business office and student accounts.
Faith Evangelical Seminary cannot offer tax advice. Please see your individual tax consultant for additional information.
According to the IRS, we do not have to file Form 1098-T or furnish a statement for:
The IRS requires every institution choose one reporting method. The seminary chose to report the amount billed so we can run the reports through our student record software system that requires using box 2.
NOTE: The tax credits are allowable only for amounts actually paid during the year and not amounts reported as billed, but not paid, during the year.
The seminary sent these forms in compliance with IRS guidelines. However, we cannot offer any tax advice on this issue. If you have further questions, please utilize the resources listed at the bottom of the page.
However, the business office will:
EXPLANATION OF BOXES ON FORM
NOTE REGARDING BOX 1 & 2: Schools are required to report an amount in either box 1 (amounts paid in the tax year) or box 2 (amounts billed in the tax year), not both. The seminary reports amounts billed in the tax year in box 2, which may represent an amount other than the amount actually paid in the tax year (as students may still owe a balance of this amount).
Box 1. Shows the total payments received from any source for qualified tuition and related expenses less any related reimbursements or refunds. (We are not required to report this amount, although we will be happy to mail or email students’ receipts for tuition and fees paid during the tax year credit and non-credit enrollments).
Box 2. Shows the total amounts billed for qualified tuition and related expenses less any related reductions in charges. (The reductions in charges that would be reflected include, but are not limited to, full-time clergy or spousal rate tuition discounts.)
Box 3. Shows whether your institution changed its method of reporting for the current tax year. The seminary did not change reporting methods this year, so this box should be blank.
Box 4. Shows any adjustment made for a prior year for qualified tuition and related expenses that were reported on a prior year Form 1098-T. This amount may reduce any allowable education credit that you claimed for the prior year.
Box 5. Shows the total of all scholarships or grants administered and processed by the eligible educational institution. Sample items that are reported in this box at Faith Evangelical Seminary are Federal Pell Grants, Armed Forces Tuition Assistance, AmeriCorps Scholarships, and scholarships given to employees toward their tuition. The amount of scholarships or grants for the calendar year (including those not reported by the institution) may reduce the amount of the education credit you claim for the year.
Box 6. Shows adjustments to scholarships or grants for a prior year. This amount may affect the amount of any allowable tuition and fees deduction or education credit that you claimed for the prior year. You may have to file an amended income tax return for the prior year.
Box 7. Shows whether the amount in box 1 or 2 includes amounts for an academic period beginning January-March of the tax year. This box should be blank as the last academic period Faith Evangelical Seminary reports is Winter Quarter, beginning in November or December.
Box 8. Shows whether you are considered to be carrying at least one-half the normal full-time workload for your course of study at the reporting institution. (Half time is considered as having taken at least 10 hours in a quarter for undergraduate students, and at least 4 hours in a quarter for graduate and post-graduate students.) If you are at least a half-time student for at least one academic period that begins during the year, you meet one of the requirements for the American Opportunity Tax Credit. You do not have to meet the workload requirement to qualify for the lifetime learning credit.
Box 9. Shows whether you are considered to be enrolled in a program leading to a graduate degree, graduate-level certificate, or other recognized graduate-level educational credential. This box should be marked if you are in a graduate or post-graduate degree at Faith Evangelical Seminary. Otherwise, it should remain blank.
Box 10. Shows the total amount of reimbursements or refunds of qualified tuition and related expenses made by an insurer. This box should be blank as Faith Evangelical Seminary is not an insurer.
Account number. May show an account or other unique number the filer assigned to distinguish your account. The combination of letters and numbers listed in this box is your Faith Evangelical Seminary Student ID Number.
IRS Website: http://www.irs.gov
This website has a large source of information, including complete tax forms available online. To find information on educational credits, click on the Credits and Deductions tab, then select “Education Credits” listed in the Individual Credits section.