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Taxpayer Relief Act of 1997 (TRA97)

**** IMPORTANT INFORMATION ****

Special IRS instructions for taxpayers who want to claim the above-the-line tuition deduction. Congress belatedly reinstated the tuition and fees tax deduction in December retroactively (it had expired January 1, 2006). The IRS had already sent its paper forms to the printer before Congress acted, so there is no place on the form 1040 for the deduction. Further, IRS needs to reprogram its software (and so will the on-line and software providers) to allow for the deduction, so the key piece of advice is that no returns claiming the tuition and fee deduction should be filed until early February. More information including instructions on how to fill out paper forms, is available at: www.irs.gov/newsroom/article/0,,id=165640.html


Paying for College: Tax Benefits and Savings Options

What is it?
The Taxpayer Relief Act of 1997 introduced two new educational tax Credits. The Hope Scholarship and the Lifetime Learning Credit. For more information regarding these credits, please refer to IRS form 8863, Publication 970, or notice 97-60. Please refer to the IRS WEBSITE for obtaining forms and publications or you can call the IRS at 1-800-829-1040.

IRS form 1098-T: Tuition Payments Statement

What is it?
An eligible educational institution that receives qualified tuition and related expenses on student's behalf must furnish Form 1098 - T to students. This statement is intended to assist you in determining whether you, or the person who may claim you as a dependant, may be eligible for a Hope Scholarship or Lifetime Learning Credit.

More Information

Who do I call for help in figuring out if I am eligiable?
Macalester College is not qualified to determine if a student qualifies for either the Hope Scholarship or the Lifetime Learning Credit. Students and/or parents should contact the IRS, your tax advisor or other financial advisor for assistance.

Why does the 1098-T Form not list what amounts I've paid?
Form 1098-T reports the qualified tuition and related expenses billed to you by the College during the calendar year. Under Internal Revenue Code 25A, you may claim an educational tax credit for qualified tuition and related expenses actually paid during the calendar year. When you receive your 1098-T Form, you will also receive a summary statement of your account for that calendar year showing the debits and credits to your account so that you may easily evaluate your eligibility for these educational credits.

THIS INFORMATION MUST NOT BE CONSTRUED AS TAX ADVISE.

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