Tax Information

American Opportunity Credit/Lifetime Learning Credit/Tuition and Fees Deduction

The American Opportunity Tax Credit (modified and expanded Hope Scholarship Credit) is available for students in their first four years of post-secondary education. The amount of the credit is 100% of the first $2,000 of tuition and qualified fees, plus 25% of the next $2,000, to a maximum $2,500 per each eligible student. The student must be enrolled at least halftime in a degree/certificate program in at least one semester or term beginning in the year for which they are claiming the credit. For tax years 2009 and 2010, the income limits have been expanded, and the qualified related expenses include required books, supplies and equipment not necessarily required to be purchased from the institution. See IRS Form 8863 and instructions for changes and comparisons with other credits and deductions.

The Lifetime Learning Credit is available to ISU students who are not eligible for, or who elect not to use the American Opportunity Tax Credit or the Hope Scholarship Credit. It is calculated at 20% of the first $10,000 of tuition and qualified fees, to a maximum of $2,000 per tax return. No minimum enrollment is required, and it is available for an unlimited number of years.

The Tuition and Fees Deduction of up to $4,000 is available to students who are not eligible for, or who elect not to use, the Hope credit or Lifetime Learning credit. This is an adjustment to income, and is available to higher income tax brackets than the credits listed above.

Only qualified tuition and fees paid from personal funds or educational loans qualify for calculation of these credits and deductions. Tax-free scholarships, employer-provided educational assistance, and other financial aid grants reduce the amount of qualified payments used in calculating the tax credits and deduction. Charges and fees associated with room, board, student activities, athletics, insurance, books, equipment, transportation, and similar personal, living, or family expenses are not qualified tuition and related expenses.

While ISU personnel are not authorized to give tax advice, more ISU related tax information is available on the ISU_1098-T Information Sheet.

Form 1098-T

ECSI Processing: Idaho State University converted systems from a legacy system to the Sungard Banner student module effective for Fall Term 2010. We combined the transactions from the Spring 2010/Summer 2010 legacy system and the Fall 2010/Spring 2011 Banner system using ECSI, a service provider, to help us report the combined information. ECSI will mail the 1098-T Forms to students by January 31, 2011. In addition, they will provide on the 1098-T login information to access to their website (www.ecsi.net/1098t). Login information can be requested by phone at (208) 282-3000 ext H after February 7. Those who already have login access to ECSI from Perkins Loan servicing can access 1098-T information through the same login.

Change in Reporting Method: Because of the change in student system processing, it became necessary to change the method of reporting on 1098-T. Prior to 2010, Box 1 (Payments Received) had been reported. For 2010, Box 2 (Charges Billed) is the method used. It will be necessary to evaluate the payments made in 2010 to determine the correct amount of tuition and qualified fees to report on Form 1040. The detail transactions are available on the ECSI website, and up to 49 transactions will be listed on the Form 1098-T that will be mailed. The transactions included are those processed in calendar year 2010. Transactions which occurred in 2009 are available on the 2009 1098-T, and those occurring in 2011 are available on BengalWeb.

Addresses: The 1098-T Forms are generally going to the student's mailing address, if available. Those who have not provided a valid address should contact ISU 1098-T Services to update their address and get access to the 1098-T Form if they haven't received the form by February 7. Since the data originated from multiple systems, and the addresses were not all updated, please also review your address in BengalWeb and update if necessary.

Corrections: If the taxpayer identification number (SSN or TIN), name, address or other information provided on the 1098-T form is incorrect, please call (208) 282-3935 by March 15, 2011 to correct the information. This will allow us to provide you with a corrected 1098-T, and to submit correct information to the IRS. You may also provide corrections via fax at (208) 282-4701 or stop by Student Accounts (behind the Cashier's Office) in the Administration Building (Building 10)

NonResident Aliens: Students who are NonResident Aliens (NRA) are generally not eligible for educational tax benefits. We did not include NRA students in the 1098-T process. Those who need to have their information reported to the IRS by us can verify the taxpayer identification number and request the reporting by calling (208) 282-3935. IRS reporting of 1098-T information for NRA students is not required unless requested. The transaction listing is also available on request.

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