1098-T/Education Tax Credits Information

The information listed below is offered as a guide for students and not intended to provide professional tax advice. If you have questions or need further assistance you might wish to contact the Internal Revenue Service (IRS).

What is a 1098-T?

The Taxpayer Relief Act of 1997 created several new tax benefits, which include the Hope Credit and the Lifetime Learning Credit. Both credits allow eligible taxpayers to claim a tax credit against their federal income tax for qualified tuition and related expenses. The 1098-T form will be mailed by January 31, 2008. The 1098T form is for your use when preparing your taxes for calendar year 2007.

Frequently Asked Questions by Los Rios Students:

  1. Is this form a bill?
    • No, it is not.
  2. Why is Los Rios CCD asking for my social security number (SSN) or individual taxpayer identification number (ITIN)?
    • The IRS imposes a penalty of $50 per information return for missing or incorrect SSN/ITINs. If not provided, or your number does not look accurate, we will contact you and request you submit your number to your College’s Business Services Office on Form W-9S, Request for Taxpayer Identification Number. If you do not provide the requested information, you may be liable for the $50 penalty.
  3. Do I need to provide a SSN/ITIN if I am a non-resident alien student?
    • No, you do not need to provide an SSN or ITIN as the District is not required by the IRS to report your tuition information.
  4. Is this form a source of income I must include on my tax forms?
    • No, this form is a statement of the amount of adjusted tuition we have recorded for you in 2007.
  5. How is the amount determined?
    • It will include the amount paid for tuition, less refunds and fee waivers.
    • It includes payments received in the reporting year, without regard to the semester the payment applies to. For example, if payment was processed by the District in December 2007 for the Spring semester starting January 2008, the payment would be included on the 1098-T for calendar year 2007.
  6. Who do I contact if I think the information is incorrect?
    • It is important to remember that the amount on this form consists of payments processed by the District in calendar year 2007. If a payment you made was processed in December 2007 for the Spring 2008 semester, the payment will be included on the 1098-T for 2007 since the payment was processed in 2007.
    • The Business Services Office at the campus you attended can assist you in determining the correct amount. Call the phone number on the1098-T form to be connected to the college you attended.
  7. Who do I contact if I did not get my form?
    • Please call the Business Services Office of the campus you attended.
  8. Do I need this form to complete my taxes?
    • No, this form does not need to be submitted to the IRS when you send in your tax forms.
  9. Does Los Rios send this information to the IRS?
    • Yes, we send the information to the IRS.
  10. How do I use qualified tuition and related expense information when preparing my tax return?
    • Instructions for calculating the credit can be found on IRS Form 8863 and in IRS Publication 970. You may want to consult the IRS to determine the amount of credit that you may be eligible to claim.
  11. Is the amount reported for qualified tuition and related expenses the total amount of the tax credit I can claim on my tax return?
    • No, not in all situations. The amount of the tax credit that you may claim will depend on your individual situation. You may want to consult the IRS and/or refer to IRS Publication 970 to determine how the Hope and Lifetime Learning tax credits affect you.

Hope Credit

The Hope Credit may be claimed for qualified tuition and related expenses paid for each student in the taxpayer’s family (i.e., the taxpayer, the taxpayer's spouse, or an eligible dependent) who is enrolled at least half-time in one of the first two years of postsecondary education and who is enrolled in a program leading to a degree, certificate, or other recognized educational credential. The amount that may be claimed as a credit is generally equal to: (1) 100 percent of the first $1,100 of the taxpayer’s out-of-pocket expenses paid for each student’s qualified tuition and related expenses, plus (2) 50 percent of the next $1,100 of the taxpayer’s out-of-pocket expenses paid for each student’s qualified tuition and related expenses. Thus, the maximum credit a taxpayer may claim for a taxable year is $1,650 multiplied by the number of students in the family who meet the IRS eligibility criteria

For 2007, the amount a taxpayer may claim as a Hope Credit is gradually reduced for taxpayers who have modified adjusted gross income between $47,000 and $57,000 ($94,000 and $114,000 if you file a joint return). The amount of the credit may be reduced based on the taxpayer's modified adjusted gross income. Taxpayers with modified adjusted gross income of $57,000 or more ($114,000 or more if you file a joint return) cannot claim the Hope Credit.

Lifetime Learning Credit

The Lifetime Learning Credit may be claimed for the qualified tuition and related expenses paid for all students in the taxpayer’s family (i.e., the taxpayer, the taxpayer's spouse, or an eligible dependent) who are enrolled in eligible educational institutions. For 2007, the amount that may be claimed as a credit is equal to 20 percent of the taxpayer’s first $10,000 of out-of-pocket qualified tuition and related expenses paid for all the students in the family. Thus, the maximum credit a taxpayer may claim for 2007 is $2,000.

If the taxpayer is claiming a Hope Credit for a particular student, none of that student’s expenses for that year may be applied toward the Lifetime Learning Credit. The amount a taxpayer may claim as a Lifetime Learning Credit is gradually reduced for taxpayers who have modified adjusted gross income between $47,000 and $57,000 ($94,000 and $114,000 if you file a joint return). Taxpayers with modified adjusted gross income of $57,000 or more ($114,000 or more for a joint return) cannot claim a Lifetime Learning Credit. The definition of modified adjusted gross income is the same as it is for purposes of the Hope Credit.

Link to IRS web site for more information: