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Changes to Tuition Expense Rules Proposed by IRS

Changes to Tuition Expense Rules Proposed by IRS

The Internal Revenue Service has proposed a change in the rules for claiming qualified education tuition and expenses. The changes were mandated by the Protecting Americans from Tax Hikes Act (also known as the PATH Act) as well as the trade Preferences Extension Act of 2015 (TPEA).

Among some of the notable changes put forth in the 59-page filing from the IRS:

  • A student will be required to have a Form 1098-T from the eligible educational institution before the American Opportunity Tax Credit (AOTP), the Lifetime Learning Credit (LLC), or the qualified tuition and related expenses deduction can be claimed.
  • If claiming either credit or the deduction, the taxpayer must include the educational institution’s Employer Information Number (EIN) on the return. The legislation also requires the EIN to appear on Form 1098-T.
  • Educational institutions must report total payments they received from the taxpayer on the Form 1098-T. The option to report the total amount billed to the taxpayer was eliminated.
  • The filer’s Taxpayer Identification Number (TIN) and that of the student (if different) must both be issued on or before the due date of the return.

A public hearing on the proposed rule changes is slated for Nov. 30 in Washington, D.C.


Bob Williams

Forget genes; I’ve got words in my DNA. Communication has been part of who I am nearly all my life. From a long career in radio news to another one in newspapers – and a University of Georgia journalism degree sandwiched between the two – language has been my life. I’ve also been fortunate to have learned the tax business from the ground up here at Drake, starting with 1040.com online forms some years ago before moving on to work on the Web. In all things tax-ish, we aim to give you tools you can use.