Where the 1098-T goes on your tax return

The 1098-T does not go directly on your main tax form. Instead, you use the information from it to fill out Form 8863 (Education Credits), which then connects to your Form 1040. The school sends you the 1098-T by January 31 each year; you then report those education expenses on Form 8863 to claim either the American Opportunity Credit or the Lifetime Learning Credit.

If you file electronically, tax software will walk you through entering the 1098-T data and automatically generate Form 8863. If you file by paper, you complete Form 8863 yourself, attach it to your Form 1040, and keep your 1098-T with your records — you do not mail it to the IRS.

The key step most people miss: the 1098-T shows what the school reported, but you decide which education credit to claim based on your situation. The form itself does not make that choice for you.

Key Takeaways

  • Use information from your 1098-T to complete Form 8863, which attaches to your Form 1040 — the 1098-T itself does not go on your return.
  • You receive the 1098-T from your school by January 31, showing may have access to education expenses paid in the prior year.
  • Form 8863 requires you to choose between the American Opportunity Credit (up to $2,500 per student) and the Lifetime Learning Credit (up to $2,000 per return), based on your income and enrollment status.
  • If you paid education expenses but did not receive a 1098-T, you can still claim credits using receipts and invoices as proof.
  • Tax software typically handles the 1098-T entry and Form 8863 completion automatically if you provide the numbers from your form.

Step-by-step: entering 1098-T information into Form 8863

Start by locating Box 1 and Box 2 on your 1098-T. Box 1 shows may have access to tuition and related education expenses; Box 2 shows scholarships or grants the school reported. You will need both numbers.

On Form 8863, Part I asks for the student's name and Social Security number. Part II is where you enter the expenses from your 1098-T. If using tax software, you enter the Box 1 amount when prompted for may have access to expenses. The software will subtract any scholarships (Box 2) automatically, because scholarships reduce the expenses you can claim for a credit.

Next, you select which credit to claim. The form walks you through income limits and student status. The American Opportunity Credit requires the student to be in their first four years of undergraduate study; the Lifetime Learning Credit has no enrollment restrictions. If income exceeds the limit for one credit, you may still may have access to for the other.

Once Form 8863 is complete, it attaches to your Form 1040. The credit amount then reduces your tax liability dollar-for-dollar.

What boxes on the 1098-T you actually need

Most readers only need three boxes. Box 1 is may have access to tuition and related education expenses paid during the tax year. Box 2 is scholarships or grants reported by the school. Box 5 indicates whether the student was enrolled at least half-time — this matters for the American Opportunity Credit, which requires half-time enrollment.

Boxes 3 and 4 relate to graduate-level expenses and are less common. Box 6 flags if the student was a nonresident alien for part of the year, which affects credit may be able to access. Box 7 shows adjustments the school made to reported expenses.

If you are claiming the Lifetime Learning Credit, you primarily need Box 1. If you are considering the American Opportunity Credit, check Box 5 to confirm half-time enrollment status.

Reconciling the 1098-T with what you actually paid

The 1098-T shows what the school reported to the IRS, but it may not match what you paid out of pocket. For example, if you paid $8,000 in tuition but received a $3,000 scholarship, the school reports $5,000 in Box 1 (the net amount). You use that $5,000 figure on Form 8863, not the $8,000 you initially paid.

If you paid expenses the school did not report — such as books you bought independently or fees the school did not include — you cannot add those to the 1098-T amount. Education credits are limited to may have access to expenses the school reports. may have access to expenses include tuition, fees, and course materials required by the school; they do not include room and board, transportation, or insurance.

Keep your receipts and the school's invoice or statement. If the 1098-T amount seems wrong, contact the school's financial aid office to request a corrected form (a 1098-T with an X in the "Corrected" box). Do not guess or adjust the number yourself on Form 8863.

When you do not receive a 1098-T but paid education expenses

Schools are required to send a 1098-T if you paid at least $600 in may have access to expenses during the tax year. If you paid less than $600, the school may not send one. You can still claim an education credit — you just complete Form 8863 using your own records instead of the form.

Gather your receipts, tuition invoices, and proof of payment (bank statements, credit card statements, cancelled checks). Write down the total may have access to expenses you paid. On Form 8863, enter that amount in the expenses field. You will need to show these records if the IRS asks questions later, so keep them for at least three years.

If you attended a school that does not issue 1098-Ts (some vocational programs or international schools), the same rule applies: use your own documentation to complete Form 8863.

Income limits and which credit you can claim

Your Modified Adjusted Gross Income (MAGI) determines which credits are available to you. The American Opportunity Credit phases out at higher incomes; the Lifetime Learning Credit has a different income threshold. These limits change each year.

Form 8863 includes a worksheet to calculate your MAGI and determine which credits you may have access to for. If your income exceeds the limit for the American Opportunity Credit, you may still claim the Lifetime Learning Credit. You cannot claim both credits for the same student in the same year, so Form 8863 requires you to choose.

If you are married filing jointly, your combined income counts toward the limit. If you are married filing separately, different rules explore and you may not be able to claim any education credit.

Reporting multiple students or multiple 1098-Ts

If you have more than one student in college, you receive a separate 1098-T for each one. Form 8863 allows you to claim credits for up to four students on a single return. You complete a separate Part II for each student, entering their name, Social Security number, and expenses from their 1098-T.

You can claim the American Opportunity Credit for one student and the Lifetime Learning Credit for another in the same year. For example, if one child is in their first year of college and another is in graduate school, you might claim American Opportunity for the first and Lifetime Learning for the second.

The total credit is the sum of what you claim for all students, subject to your income limit. If your income exceeds the phase-out range, you lose the credit entirely — it does not reduce gradually.

Common mistakes when filing with a 1098-T

The most common error is forgetting to subtract scholarships. If Box 2 shows a scholarship amount, that reduces the expenses you can claim. Some people enter the full Box 1 amount without subtracting the scholarship, inflating their credit.

Another mistake is claiming a credit when income is too high. Form 8863 has income limits; if you exceed them, you cannot claim the credit even if you have a 1098-T. Tax software usually catches this, but if you file by paper, you must check the limits yourself.

A third error is claiming both the American Opportunity and Lifetime Learning credits for the same student in the same year. You can only choose one per student per year. If you try to claim both, the IRS will disallow one and may assess penalties.

Finally, some people claim a credit when the student is not a dependent on their return. The American Opportunity Credit requires the student to be a dependent; the Lifetime Learning Credit does not. Check your filing status and dependent claims before completing Form 8863.

Frequently Asked Questions

Do I mail the 1098-T with my tax return?

No. You keep the 1098-T with your records for at least three years. You use the information from it to complete Form 8863, which you attach to your Form 1040. The IRS does not need the 1098-T itself unless they audit your return.

What if the 1098-T shows expenses I did not pay?

Contact your school's financial aid office when ready. The school may have made an error or included expenses you did not actually incur. Request a corrected 1098-T. Do not file your return with incorrect numbers; correcting it later is more complicated.

Can I claim an education credit if I paid with a student loan?

Yes. The credit is based on expenses paid, not on how you paid them. Whether you used cash, a loan, a credit card, or a scholarship, the may have access to expenses still count toward the credit calculation.

What happens if I claim the wrong credit?

The IRS may disallow the credit or reduce it. If you claimed the American Opportunity Credit but the student was not enrolled half-time, you would lose that credit. You can file an amended return (Form 1040-X) to claim the correct credit instead, but do this as soon as you realize the error.

Can I claim an education credit for my spouse's education expenses?

Only if you file jointly and your spouse is a dependent on your return. If your spouse files their own return, they claim the credit themselves. If you file married filing separately, neither of you can claim an education credit.