Not sure whether to File this Year

Question

I am supposed to apply for the FAFSA each year, and on the FAFSA it asks about our taxes (in case we file). I am not receiving a W-2 this year since I was not on a payroll for the entire year 2014. I have a copy of the 1098t, but it is Copy B, which states "this is important tax information and is being furnished to the IRS." I interpret that to mean that I don't have to file for 1098t since the IRS is already receiving that.

How should I proceed? I am asking for any advice to be on the safe side because I want to file if I am supposed to. The problem is, I am not sure what to file since I was not on a payroll and my 1098t was already furnished to the IRS.

Answer 1

The 1098T form is used to report the amount of tuition you paid to an educational institution during the year. You generally use it to determine which tax credits you are eligible for when you do your income tax return. It is not a statement of any income or tax withholding, and you do not need to send it in to the IRS.

Did you have no income at all for 2014? If you have no income, then you are probably not required to file. Are you a dependent on someone else's tax return, perhaps your parents? Are they the ones that actually spent the money on the tuition? If so, you should give them the 1098T form, because they might be able to claim an educational credit or deduction based on the tuition paid.

If you are not a dependent on anyone else's tax return, you might be eligible for one of the educational credits even if you didn't pay any tax. This would be worth looking into. If this situation applies to you, you might want to try out one of the free online tax services and see if you can claim the credit.