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Taxpayer Relief Act of 1997

The NWACC Cashiers Office mails Student Tax Information Letters (1098-Ts) to students by January 31st per IRS guidelines. Be sure to have your current mailing address on file with the Admissions & Records Office by December 31st of any given year to ensure prompt delivery of your 1098-T.

If you do not receive a copy of your 1098-T by the second week of February, you can reprint one on your Eaglenet or you may call (479) 619-4291 to request a duplicate 1098-T. Please be sure to leave your name, social security number, and current mailing address.

NOTE: NorthWest Arkansas Community College CANNOT give you tax advice. If you should have questions regarding qualified charges and payments, please consult your tax advisor or the IRS at 1-800-829-3676 or visit their website at www.irs.ustreas.gov.

HOPE SCHOLARSHIP AND LIFETIME LEARNING TAX CREDITS

Two tax credits, the Hope Scholarship Credit and the Lifetime Learning Credit, took effect in 1998 to help families reduce out-of-pocket expenses for tuition and certain expenses paid to a post-secondary institution that participates in federal student aid programs.

  • The Hope Credit provides a credit of up to $1,500 for a student who is enrolled at least half time in one of the first two years of post-secondary education. This credit can be claimed for only two taxable years.
  • The Lifetime Learning Credit provides a credit of up to $1,000 per year for a student taking courses, including graduate-level degree work. This credit can be claimed for as long as the student is enrolled in an eligible educational institution.

Who qualifies for these credits and what are the income limitations?  

Only taxpayers qualify for these credits. If you do not pay taxes and are claimed as a dependent on someone else's tax return, they may qualify for a credit. A taxpayer may qualify if:

  • The taxpayer (you or your parents or guardian who claim you as a dependent) is paying for higher education costs for the taxpayer or their dependents.
    AND
  •  The taxpayer's Modified Adjusted Gross Income (see IRS Form 1040 or 1040A as applicable) must be:
    •  a) Equal to or less than $50,000 for single taxpayers
      OR
    •  b) Equal to or less than $100,000 for married taxpayers, filing a joint return.

There are certain other limitations specific to each of these credits. NorthWest Arkansas Community College cannot determine if you qualify for one of these tax credits or the amount of the credit due you. If you believe you might qualify, you should obtain IRS Publication 970, Tax Benefits for Higher Education and IRS Form 8863 and review the criteria carefully. To obtain copies call 1-800-TAX-FORM or go to http://www.irs.ustreas.gov/formspubs/index.html on the Internet, or consult your tax advisor.

What is the basis for determining the amount of tax credit?
The tax credit amounts are determined by the amount you paid for eligible tuition and related expenses and your income.

  • The amount of the Hope Scholarship Credit is 100% of the first $1,000 plus 50% of the next $1,000 you paid for each eligible student's qualified tuition and related expenses from January 1 to December 31. The maximum credit is $1,500 per eligible student.
  • The amount of the Lifetime Learning Credit is 20% of the first $5,000 you paid for qualified tuition and related expenses for any eligible students in the family from January 1 to December 31. The maximum credit is $1,000 per family.

IRS Publication 970 explains which tuition and fee expenses qualify and which payments qualify for the tax credits.

To receive either tax credit, you must account for and document the amount you have paid for tuition and expenses on IRS Form 8863 and file it with your Federal Income Tax Return. You do not file Form 1098-T with your tax return.

Where can I get more information?
See IRS Publication 970 and IRS Form 8863 for more information. To obtain copies, call 800/TAX-FORM or go to http://www.irs.ustreas.gov/prod/forms_pubs/. You may also want to consult a professional tax advisor or resource.


For any questions or comments please e-mail the Cashiers Web Author.