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Form 1098T Tuition statement box 4


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#1 Gail in Virginia

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Posted 04 February 2008 - 02:12 PM

I have a t/p, sending himself through college, whose 1098-T for 2007 includes an amount in box 4 - adjustments made for a prior year. According to the explanation attached to the form, box 4 shows any adjustment made for a prior year for qualified tuition and related expenses reported on a prior year Form 1098-T. This amount may reduce any allowable education credit you may claim for the prior year. See Form 8863 or Publication 970 for more information. According to publication 970, if this is received after the return is filed for that prior year, you include it in the current year by adding it to the tax. And, when I do the bunny hop on the tax line of the 1040, the worksheet has a line where I can enter the recapture tax for an education credit on this year's return. My question is, do I explain this anywhere? How will the IRS know why his tax is $48 more than the tables show it should be? I hate getting letters and having to explain things to the IRS later when I don't really remember what I did.

#2 jklcpa

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Posted 04 February 2008 - 05:56 PM

If you're filing a paper return, I'd attach the worksheet for line 44. When e-filing the worksheets don't go to IRS unless IRS requires them. I did a test return up thru creating an efile. The last item listed on the e-filed forms list is something called Federal Summary Record. I don't know what's contained in that report, maybe the data might be included there.

#3 Gail in Virginia

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Posted 05 February 2008 - 08:29 AM

I am filing paper as it happens, and when I printed the return I noticed in tiny, dark print that ERC and the amount I added is printed on the line next to the tax. I guess that will tell the IRS what I added and why, and they will let me know if they disagree with my figures. I guess I got worried too soon - I have just never changed the tax on a return like this before and it made me nervous. :rolleyes:




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