My daughter is going to college part time as an adult student. She works a lot and withdrew from a class each of two semesters, earlier this year. She didn’t realize that since it was just past the deadline, she had to pay back her financial aid as well as the tuition and fees- a steep price! She ended up with two W’s on her otherwise pristine transcript
My question is a tax question so perhaps it doesn’t belong here. I am trying to figure out the American Opportunity Credit amount for her. The school’s 1099 shows everything billed to her, which includes those two classes (which she paid a fortune for after withdrawing, certainly no refund. She got a grade- W. But, obviously, didn’t finish the classes.
My inclination is to be honest and omit those two classes’ costs from my calculations. If I do that, I cannot use the figure from the school’s 1099 and have to go through my papers to find out how much we actually paid for classes actually finished. The school website has very confusing info on amounts actually paid and only goes back to 9/15.
Was she at least a half-time degree-seeking student (6 credits)?
I was under the impression that the amount you paid for tuition, fees and books during the year counts, reduced by the scholarships and grants actually received.
I don’t know if there is a stipulation that you have to pass the courses and can’t withdraw.
So read through the AOTC rules in IRS Publication 970.
If she had received a tuition refund she would have to go back and adjust the amount of AOTC I think, but that does not seem to be the case.
I would keep records of the tuition statements and how much financial aid she had to pay back.
I couldn’t find the answer to this in Publication 970 earlier today.
No refunds. She had to pay back her Pell grant PLUS no refund of amount paid. I think she paid back about $3500 when her actual costs were less than a third of that.
The records are all online and only go back to 9/15. I can dig out my check records (I recently moved).
But I still don’t know if a withdrawal after the deadline for refund means I can count the payments on the 1099-all of it- or if I have to reduce it because some of that amount when toward classes she got W’s in.
I’m not sure, but since the school did not refund the money, she did pay for all the classes. Also paying back the Pell grant would have reduced the amount of scholarships/grants or was it covering housing expenses?
So you should be able to use the number for tuition and fees from the 1098T (box2) and add books (?). Then subtract scholarships/grants received to arrive at QEE she can claim for AOTC.
The scholarship/grant number (box 5) they listed on the 1098T does it represent the initial amount she got or the amount after paying back Pell?
