The University is required to report eligible tuition payment and scholarship and grant disbursements to the IRS each tax year on Form 1098-T. Students will receive a copy of this form by January 31st each year, which can be used to help them determine whether or not they qualify for certain educational tax credits.
While the University is required to report this information to the IRS, it does not engage in tax advice or opinion. FSU will not provide you with information about the taxability of your scholarships and grants, and cannot advise you on the use of the 1098-T in your annual tax filing. You should consult a tax professional or your accountant for more information about the taxability of your educational awards.
What does the 1098-T report?
Most students will see two boxes populated on their 1098-T-- box 1, and box 5. Some students may have box 4, and box 6 populated as well. All transactions on the 1098-T reflect activity that occurred within a calendar year, regardless of the year or term that the transaction affected.
Box 1: Payments Received for Qualified Tuition
Box 1 will report payments made toward qualified tuition and related expenses in a calendar year. The IRS does not consider fees for health services or transportation qualified tuition, so payments made toward these charges will not be reflected on the 1098-T. All other tuition and related expenses paid are reported in Box 1.
Box 4: Adjustments to Qualified Tuition from a Prior Reporting Period
Any changes to a prior tax year that resulted in a reduction of payments toward previously reported qualified tuition will be reported in Box 4. For example, if the University reports $500 in payments in 2016, but a student retroactively drops a course from 2016 in the 2017 year without fee liability, the dropped value will appear in Box 4.
Box 5: Scholarships and Grants Received
Box 5 reports the amount of scholarships and grants disbursed in a calendar year. Scholarships and grants are defined by the IRS, so may include items that you do not recognize as a scholarship or grant-- for example, Graduate Matriculation and Out of State waivers are reported in Box 5, as are military benefits and payments from third party organizations.
Box 6: Adjustments to Scholarships and Grants Reported in a Prior Year
Similar to Box 4, Box 6 reports adjustments to previously reported scholarships and grants from a prior year. If a scholarship or grant is retroactively revoked, the value of the scholarship or grant will be reported in Box 6.
Why are my scholarships / grants for next year reported on my 1098-T this year?
The 1098-T only displays transactions that occur within a calendar year, regardless of the year that the transactions affect. For example, your Box 5 value for Scholarships and Grants may be higher than what you actually received in a year if your department or third party payment provider pays your future term tuition in the current year. This often happens when an academic department pays a student's tuition-- tuition for the Spring semester is calculated in December of the preceding tax year, and if the department pays that tuition in December it will appear on the current tax year form.
Why does my reported payment amount in Box 1 not match my receipts?
Tuition at FSU includes transportation access and health fees which are not considered qualified expenses under IRS code. These fees are removed from reporting in Box 1, and can make it appear that less was reported than what you paid. Also, not all fees at the University are reported in Box 1, only those related to tuition-- no housing, no dining, no books, etc.