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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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