Question

Will reporting the information on my Form 1098-T increase my refund?

Answer

Your Form 1098-T can include qualifying expenses you paid during the year that make you eligible for an education credit or deduction, so reporting this information could increase your refund. Whether it does — and by how much — depends on your tax liability and which credit you claim.

The Lifetime Learning Credit is nonrefundable, so the credit will reduce the amount of taxes you owe. It won’t be returned to you as a refund if the credit is greater than the taxes you owe. If you don’t owe any taxes, this credit won’t provide a tax benefit for you.

The American Opportunity Credit is partially refundable, so if you qualify, you could have up to 40% of the credit refunded to you. This is true even if you didn’t owe any taxes. The remaining nonrefundable portion is applied to your tax liability. However, it wouldn’t be refunded to you if you didn’t owe taxes.

The tuition and fees deduction reduces the amount of income on your return. If you don’t owe any taxes, this deduction won’t provide you a tax benefit.

If taxable scholarships are reported on your Form 1098-T, it might decrease your refund, or you might have to pay taxes instead.

Related Topics

Related Resources

Form 1099-B, Proceeds From Broker and Barter Exchange Transactions

If you sold stock, bonds or other securities through a broker or had a barter exchange transaction, you will likely receive a Form 1099-B. Learn more from H&R Block.

6 Ways to Maximize Your Refund

Think it's too late to make a difference on this year's tax return? Think again! Learn how to maximize tax deductions and increase your refund with H&R Block.

What To Do When You Have an Estimated Tax Penalty

Learn more about your options to reduce or remove an IRS estimated tax penalty. Get the facts from the tax experts at H&R Block.

IRS Notice CP79 – We Denied One or More Credits Claimed on Your Tax Return

The IRS has disallowed one or more of the credits claimed on your tax return. Learn about your options to address IRS notice CP79 from the experts at H&R Block.