In August 1997, the Taxpayer Relief Act of 1997 (TRA97) was signed into law. This law established the Hope and Lifetime Learning Tax Credits and a deduction for student loan interest. Whether a taxpayer may take advantage of these benefits depends on the taxpayer’s individual facts and circumstances. The following information is being provided to assist in determining whether an income tax credit may be available to you. This information should not be construed as tax advice.
The Hope Tax Credit provides up to $1800 per student for qualified tuition and related expenses for the first two years of postsecondary education.
In computing the credit, qualified tuition must be reduced by scholarships, grants, and other tuition benefits that are afforded tax-free treatment to the student. The Hope Tax Credit can be claimed for only two years per student, and applies only to the first two years of post secondary education (presumably the freshmen and sophomore years of a four-year degree program, or equivalent).
To be eligible, students must be enrolled at least halftime for the course of study he or she is pursuing for at least one academic period during the calendar year.
The Lifetime Learning Tax Credit applies to qualified tuition and fees for undergraduate, graduate, and continuing education course work at an eligible education institution. It provides a credit equal to 20 percent of qualified expenses of no more than $10,000 per family taxpayer, not per student, resulting in a $2,000.00 maximum tax credit. Eligible education expenses are offset by scholarships, grants, and other tax-free tuition benefits.
Allowable Education Credits. The full credits are limited to individuals with modified adjusted gross income (MAGI) between $48,000 and $58,000. The range is $96,000 through $116,000 if filing a joint return. Please refer to General Instructions Form 8863 Education Credits (Hope and Lifetime Learning Credits) for Allowable Education Credits IRS Form 8863: Education Credits.
An eligible educational institution, such as The University of Texas-Pan American, that receives qualified tuition and related expenses on a student’s behalf, must furnish form 1098-T to the student. Receipt of form 1098-T does not indicate eligibility for the tax credit. The form 1098-T is not required to be attached to the taxpayer’s tax return.
The University of Texas-Pan American will send a form 1098-T to students who incurred tuition and fee expenses for a calendar year, or had an adjustment to amounts billed or scholarships received in a prior year, by January 31st of the following year. It will be mailed to the student’s permanent address as it appears in the Student Information System. Students are encouraged to update their address on the student website (assist.utpa.edu) to their current address.
The following information must be included on the Form 1098-T and reported to the IRS:
Taxpayers who have taken loans to pay qualified higher education expenses for themselves, their spouse, or their dependent may be able to deduct interest paid on these student loans.
Any lender that receives interest payments on qualified education loans totaling $600.00 or more from a single borrower during a calendar year must file an information return with the IRS with respect to the borrower and furnish a statement to the borrower. The form 1098-E is not required to be attached to the taxpayer’s tax return.
The following information must be included on the form 1098-E:
The University of Texas-Pan American will mail a form 1098-E to the borrower’s current billing address by January 31st of each year only if borrower’s interest payment exceeded $600.00 in one calendar year.
The University of Texas-Pan American has compiled a list of resources that may assist you in determining whether you are eligible for any tax credit or loan deduction expense.This information is not intended as legal or tax advice.
IRS Publication 970: Tax Benefits for Higher Education IRS Form 8863: Education Credits NACUBO: - Paying for College: Tax Benefits and Savings OptionsWhy did I receive a 1098-T form?
You received a 1098-T Tuition Payments Statement because you enrolled at UTPA and were billed for qualified tuition and related expenses for the calendar year, or there was an adjustment for amounts billed or scholarships received in a prior year.
Why did I receive a 1098-E form?
You received a 1098-E Student Loan Interest Statement because UTPA received $600.00 or more of interest payments from you during the calendar year.
If I received a 1098-T or 1098-E, am I eligible for a tax credit, or interest deduction?
Whether you qualify or not for a tax credit, or interest deduction, depends on the taxpayer’s individual facts and circumstances. A taxpayer may receive a 1098-T and not be able to claim an education tax credit. A taxpayer may receive a 1098-E and not be eligible to take the interest deduction. To find out more about the tax credits and interest deductions, consult a tax professional or access IRS publications http://www.irs.gov/formspubs/index.html. IRS publications and forms can also be ordered by calling 1-800-TAX-FORM (1-800-829-3676)
When and where will 1098-T’s be mailed?
Institutions must furnish 1098-T’s to individuals on or before January 31 of the year following the calendar year in which tuition was billed. Statements will be mailed to the student’s permanent address as it appears in the Student Information System. Students are encouraged to update their address on the student website (assist.utpa.edu) to their current address.
When and where will 1098-E’s be mailed?
Lenders must furnish 1098-E’s on or before January 31 of the year following the calendar year in which payments of interest on a qualified education loan were received. They will be mailed to the borrower’s current billing address.
I expected a 1098-T and didn’t receive one, was one generated for me?
There are certain situations where a 1098-T was not generated. 1098-T’s were not generated for non-resident aliens who did not have a valid social security number, nor for students only enrolled in non-credit courses Under IRS rules, reporting requirements do not apply to:
If I do not have a taxpayer number, how do I get one?
To process a 1098-T for a student with a temporary student identification number complete IRS Form W-9S, Request for Student’s or Borrower’s Taxpayer Identification Number and Certification . This form can be downloaded from http://www.irs.gov/formspubs/index.html or by calling 1-800-TAX-FORM.The completed W-9S form can be mailed to: The University of TX-Pan American, ATTN: Payroll Tax Office, 1201 West University Drive, Edinburg, TX 78539 or it can be delivered to the Payroll Tax Office, located at AB221.
My personal records are incomplete. I need amounts broken down by semester.
Billing statements may be accessed:
If scholarships or grants are not reflected in billing statements, and a record is needed the department which processed the award will need to be contacted.
THE INFORMATION PROVIDED IN THIS WEBSITE IS NOT INTENDED AS LEGAL OR TAX ADVICE. INDIVIDUALS SHOULD OBTAIN IRS PUBLICATION 970, TAX BENEFITS FOR HIGHER EDUCATION, OR CONTACT A TAX PRACTITIONER ABOUT PERSONAL INCOME TAX SITUATIONS.