Form 1098-T box 1 and box 5.

What a 1098-T is

An eligible educational institution files Form 1098-T for each student it enrolls and for whom a reportable transaction is made, and sends the student a statement. Pub. 970 says the school should send it by January 31, or the next business day (for the 2025 forms that was February 2, 2026 because January 31 fell on a Saturday). For 2026 forms January 31, 2027 is a Sunday, so the next business day is Monday, February 1.

Schools do not have to file for courses with no academic credit, nonresident alien students (unless the student asks), students whose qualified expenses are entirely waived or paid entirely with scholarships, and certain students covered by a formal billing arrangement with an employer or a governmental entity.

The boxes

Box 1: payments received

Box 1 is the total of payments received for qualified tuition and related expenses from all sources during the calendar year, less any reimbursements or refunds made during the year that relate to those same-year payments. It is not reduced by the scholarships in box 5, and it includes past-due amounts from a previous year only if the school billed the student for them. Pub. 970 warns that the number on the form may differ from what you paid, and when you figure a credit you use only the amounts you paid or are deemed to have paid in the tax year.

Box 4 and box 6: adjustments for a prior year

Box 4 reports reimbursements or refunds of qualified expenses made this year that relate to payments reported for any prior year after 2002, and reductions in charges that relate to amounts billed in a prior year. Box 6 reports reductions in scholarships or grants that were reported for a prior year. If you took a credit on the earlier year, these adjustments can mean part of it has to be given back.

Box 5: scholarships or grants

Box 5 is the total of scholarships and grants the school administered and processed in the year to pay the student’s costs of attendance. A Pell grant is one the school always administers. Tax-free scholarship money cannot also be counted as paid expenses for a credit. A scholarship that is more than qualified expenses, or pays for room and board, can be taxable income to the student.

Box 7, box 8 and box 9: checkboxes

Box 7 flags payments in the year that relate to an academic period beginning in January through March of the next year. Box 8 is checked if the student was at least a half-time student during any academic period that began in the year. Box 9 is checked if the student was a graduate student, meaning enrolled in a program leading to a graduate-level degree, certificate or other credential. Box 10 shows insurance reimbursements.

Which credit does it point to?

The American opportunity credit is up to $2,500 per eligible student: 100% of the first $2,000 of qualified expenses plus 25% of the next $2,000. It is for the first four years of postsecondary education, needs at least half-time enrollment for one academic period, and 40% of it can be refundable. The lifetime learning credit is 20% of the first $10,000 of qualified expenses, a maximum of $2,000 per return, has no half-time or degree requirement and is not refundable. You cannot claim both for the same student in the same year.

Both phase out with income. In Pub. 970 (2025) the American opportunity credit phases out between $80,000 and $90,000 of modified AGI ($160,000 to $180,000 joint) and is not allowed above that. The lifetime learning credit table lists the same $90,000 and $180,000 limits. To compute the dollars, use the AOTC and lifetime learning credit calculator linked on this page.

Worked example

Box 1 shows $9,800 and box 5 shows $6,000 for an undergraduate who is a half-time student. The parents also paid $600 for required textbooks. The scholarship paid for tuition, so the parents count out-of-pocket qualified expenses: $9,800 minus the $6,000 scholarship plus $600, or $4,400. Because that is above $4,000, the full $2,500 American opportunity credit is available if income allows it. Box 1 alone would have suggested $9,800.

Sources

• Instructions for Forms 1098-E and 1098-T (2026) — boxes 1, 4 to 10; who files
• Publication 970 (2025) — American opportunity and lifetime learning credits; income limits

Figures and rules above were retrieved November 2026 from the IRS pages listed. Credit amounts and income limits are from Publication 970 (2025), the latest edition read; confirm the limits for the year you file.

Frequently asked questions

What is box 1 on Form 1098-T?

Box 1 is the total payments the school received for qualified tuition and related expenses during the calendar year, less reimbursements or refunds made in the same year. It is not reduced by the scholarships in box 5.

What is box 5 on Form 1098-T?

Box 5 is the scholarships and grants the school administered and processed in the year to pay the student’s costs. Tax-free scholarship money cannot also be counted as paid expenses for a credit.

Do I need a 1098-T to claim an education credit?

The form helps, but you claim the credit on what you actually paid. Pub. 970 says to use only the amounts you paid or are deemed to have paid, and that the amount on Form 1098-T might differ from what you paid.

What do boxes 8 and 9 mean?

Box 8 is checked if the student was at least half-time in any academic period that began in the year. Box 9 is checked if the student was a graduate student. The American opportunity credit needs half-time enrollment and is for undergraduates in their first four years.

What if the school did not send a 1098-T?

Schools do not have to file one for courses with no academic credit, nonresident alien students unless requested, students whose expenses are entirely waived or paid by scholarships, and some employer or government billing arrangements. Ask the school for your records if you paid qualified expenses.