EDUCATION TAX BENEFITS
Don't Miss Out on Valuable Benefits
If you have a student in college, you may be eligible for valuable tax credits from the IRS and your state.
However, in order to claim those credits on your return, we require some very specific documentation of what expenses were incurred and how they were paid.
If your student is 18 or older, most schools will not release any information to a third party, so you may need to have your child request the information. However, many schools make the required information available through the student’s online account.
IRS and New York have been conducting more audits on education expenses. We cannot complete your tax return without all required information.
REQUIRED FOR ALL STUDENTS
In order to complete your return, we must have the following documents. If the student attended multiple schools during the year, we need the information from all schools.
Different schools may call the statements by different names. If there is confusion, you may want to show them this letter.
Form 1098-T: This tax form shows that the student was registered at a particular school during the calendar year; the dollar amounts reported on the form are often unreliable. (This form is generally mailed to the student or provided in their online account.)
If the student is finishing their final year and all expenses were paid in the prior calendar year, a 1098-T may not be issued.
Bursar’s Statement or Financial Account Transcript: A printout of all financial activity (charges and payments). It must show descriptions, dates, and amounts, and must include all activity covering the academic years that coincide with the tax year. (For example, for your 2022 tax return, we need all activity for the 2021-2022 and 2022-2023 school years, even though some transactions may have posted in 2020 or 2024.)
Payments for Required Textbooks and Supplies: A list of required materials and costs is acceptable in lieu of receipts but might not be accepted in an audit. Expenses for computer equipment may be included, depending on circumstances. General supplies (paper, notebooks, book bags, etc.) do not qualify for any credit.
REQUIRED IF YOU HAVE A COLLEGE SAVINGS ACCOUNT
College Savings Accounts include both 529 and Coverdale (ESA) accounts.
Form 1099-Q: If your student is the beneficiary of any college savings accounts (whether owned by you, the student, or someone else), a 1099-Q is issued if there were any payments made from the account. The form may be sent to student or to the account owner; if the account is owned by someone else (such as a grandparent) you will need to ask them for a copy.
Account Statements: For all 529 and Coverdale accounts that you own, we need a year-end statement that covers January to December. If that is unavailable, please provide all monthly or quarterly statements.
REQUIRED IF YOU ARE MAKING STUDENT LOAN PAYMENTS
Form 1098-E: if you or your student made payments on a student loan, this form reports the amount of interest that was paid during the year. A substitute form may be printed on your December or January bill, or the form may be available through your online account.