Savanna Hoffman
International students in the United States may or may not receive Form 1098-T, a tax document that reports payments made for qualified tuition and related expenses. Generally, non-resident aliens, international students, or those with waived tuition fees do not receive this form. However, some institutions, such as Penn State, provide Form 1098-T to all students, including international students, regardless of eligibility for tax benefits or filing taxes in the US. It is the student's responsibility to determine their tax status and whether they need to file taxes. International students who are considered US residents for tax purposes may request Form 1098-T and use it for informational purposes when filing taxes.
| Characteristics | Values |
|---|---|
| Form name | 1098-T |
| Who needs to fill it? | Students who file income taxes in the United States |
| Who doesn't need to fill it? | Nonresident aliens, international students, students with tuition entirely waived, students with tuition paid fully by scholarships |
| What is it used for? | Reporting payments received for qualified tuition and related expenses for the tax year ending on December 31 of the preceding calendar year |
| What information does it include? | Tuition charges, scholarships received, and payments made |
| When is it available? | By January 31 |
| How to access it? | Electronically or by mail |
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What You'll Learn
International students' eligibility for Form 1098-T
However, starting with the reporting year 2019, some universities like Penn State began issuing a Form 1098-T for all students, including international students who may or may not be eligible to receive an education tax benefit or who may not file taxes in the United States. This is because the university is required by the IRS to report payments received for qualified tuition and related expenses for the tax year ending on December 31 of the preceding calendar year.
International students who are considered non-residents for tax purposes may still receive a Form 1042-S (Foreign Person's U.S. Source Income Subject to Withholding). This form is typically provided to international students who received scholarships exceeding their qualified tuition for at least one academic term.
It is important to note that each student is responsible for determining their tax status and eligibility for tax credits. International students can refer to the Internal Revenue Service's website or consult a professional tax advisor for more information on their specific situation.
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Form 1098-T as an informational tax document
Form 1098-T, also known as the "college tax form" or the "tuition tax form", is a tax document that reports payments received for qualified tuition and related expenses for the tax year ending on December 31 of the preceding calendar year. It includes financial information such as tuition charges, scholarships received, and payments made. This form is used by students and their families who file income taxes in the United States to determine their eligibility for income tax credits based on the amounts they have spent on education.
The form will show the total payments made for qualified education expenses within a tax year. These qualified expenses include tuition for courses taken for academic credits. Other payments or education-related expenses, like room and board, transportation, and similar personal costs, are not considered qualified education expenses and will not appear on the form.
The tax credits that can be claimed using Form 1098-T include the American Opportunity Credit, which is worth up to $2,500 for each eligible student and is partially refundable, and the Lifetime Learning Credit, which offers a credit of up to $2,000 and can be used for undergraduate or graduate tuition.
It is important to note that not all students will receive Form 1098-T. According to IRS guidelines, this form will not be provided to non-resident aliens, international students, or in cases where qualified tuition and related expenses are entirely waived or fully paid with scholarships. However, some international students may receive Form 1042-S, which is issued to foreign persons with U.S. source income subject to withholding.
If you are an international student and have received Form 1098-T, it is your responsibility to determine if you should file taxes and if you are eligible for any tax credits. You can refer to the Internal Revenue Service's website or consult a professional tax advisor for more information.
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Determining eligibility for income tax credits
If you are an international student, you may have received a Form 1098-T. This is a tax document that reports payments received for qualified tuition and related expenses for the tax year ending on December 31 of the preceding calendar year. It includes financial information such as tuition charges, scholarships received, and payments made. While this form can be used to determine eligibility for income tax credits, it is important to note that nonresident aliens are generally not eligible for education-related tax credits or deductions. Most F-1/J-1 international students are considered nonresidents of the United States for tax purposes.
To determine eligibility for income tax credits, there are several factors to consider. Firstly, you need to establish your residency status. If you are a U.S. resident for tax purposes, you may be eligible for certain tax credits that are available to residents. These may include education tax credits, such as the American Opportunity Credit and the Lifetime Learning Credit, which can be claimed with Form 1098-T. However, if you are a nonresident alien, you are typically not eligible for these education-related tax credits or deductions.
Secondly, your income level will play a crucial role in determining your eligibility for income tax credits. Certain tax credits, such as the Earned Income Tax Credit (EITC), are designed for low- to moderate-income workers. To qualify for the EITC, you must meet specific income thresholds, which can vary from year to year. For example, for the 2024 tax year, you may qualify for the EITC if your Adjusted Gross Income (AGI) was $66,819 or less. Additionally, the amount of investment income you have can impact your eligibility; if you had more than $11,600 of investment income in 2024, you would not be eligible for the EITC.
Another factor that can influence your eligibility for income tax credits is your marital status and whether you have any qualifying children or dependents. The EITC, for instance, may provide a higher credit amount if you have children, although it is not a requirement to have children to qualify. Additionally, your spouse's income and tax status may also come into play when determining eligibility for certain tax credits.
Lastly, the type of expenses you incur can impact your eligibility for specific tax credits. For example, the premium tax credit is a refundable benefit for low-to-middle-income taxpayers who purchase health insurance from qualified health insurance marketplace plans. Similarly, the electric vehicle tax credit offers a credit for buying a new or used electric vehicle. These credits are independent of having qualifying children or dependents and focus instead on incentivizing specific types of purchases or behaviours.
It is important to consult official sources, such as the Internal Revenue Service (IRS) website, or seek advice from a professional tax advisor to determine your specific eligibility for income tax credits, as the rules and requirements can be complex and vary depending on your individual circumstances.
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Non-resident alien status
The term "non-resident alien" refers to any individual who is not a U.S. citizen or U.S. national and has not passed the green card test or the substantial presence test. Most F-1/J-1 international students are considered non-residents of the United States for tax purposes. In general, anyone entering the U.S. in F or J student status is exempt from the substantial presence test for the first 5 years, making them non-residents for tax purposes during that time.
If you are a non-resident alien, you may still be required to file a federal tax return if you are living and working in the U.S. Additionally, if you are engaged or considered to be engaged in a trade or business in the U.S. during the year, have U.S. income on which the tax liability was not satisfied by withholding tax at the source, or want to claim a refund of excess withholding, you must file a return.
Non-resident aliens are generally not eligible to claim any education-related tax credits or deductions. However, starting with the 2019 reporting year, Penn State began issuing Form 1098-T to all students, including international students who may or may not be eligible for an education tax benefit or who may not file taxes in the U.S. It is each student's responsibility to determine if they should file taxes and/or if they are eligible for a tax credit.
It is important to note that you can be both a non-resident and a resident for U.S. tax purposes during the same tax year, typically in the year you arrive or depart from the country. In such cases, you need to file a dual-status income tax return.
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How to access Form 1098-T
If you are a current student, the Form 1098-T will be available on your Student Account Dashboard. To access and view the form, click on "Tax Forms" on the left side menu. You can then download, save, or print the form.
Form 1098-T is a tax document used to report payments received for qualified tuition and related expenses for the tax year ending on December 31 of the preceding calendar year. Eligible educational institutions are required to file Form 1098-T for each student enrolled and for whom a reportable transaction is made.
Students who file income taxes in the United States can use Form 1098-T to determine eligibility for income tax credits. It is important to note that nonresident aliens are generally not eligible to claim any education-related tax credits or deductions for which Form 1098-T is intended.
According to IRS guidelines, a 1098-T statement will not be provided to non-resident aliens, international students, or where qualified tuition and related expenses are entirely waived or paid in full with scholarships. However, some universities, such as Penn State, issue Form 1098-T to all students, including international students, regardless of their eligibility to receive an education tax benefit or their tax filing status in the United States.
To obtain the necessary information for filing Form 1098-T, educational institutions may present the option to consent to receive the form electronically as part of a global "Consent To Do Business Electronically." This combines consent for electronic delivery of Form 1098-T with other institutional student business functions such as admissions, registration, billings, and direct deposits.
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