The following information will help you with the mechanics of calculating and claiming tax breaks. Additional details and examples can be found in IRS Publication 970, Tax Benefits for Education at www.irs.gov
| Tax Break | Tax Statement You Will Receive | Where to Report/Claim |
|---|---|---|
| Coverdell Education Savings Accounts | 5498-ESA for contributions, provided by the financial institution where the account is held 1099-Q for distributions, provided by the financial institution where the account is held |
Taxpayer does not report contributions to the IRS. Non-taxable distributions are not reported. Taxable distributions: Form 5329, Part II and Form 1040, line 21 |
| Qualified Tuition Program | No statement of contributions is required for federal income tax purposes. 1099-Q for distributions |
Check for state income tax filing requirements if the state offers a deduction for contributions. Taxable distributions: Form 5329, Part II and Form 1040, line 21 |
| Savings Bond Interest Deduction | 1099-INT | Form 8815, Exclusion of Interest from Series EE and I U.S. Savings Bonds Issued After 1989 Schedule B, line 3 |
| American Opportunity (Hope) Credit | Form 1098-T, provided by the educational institution, showing payments received or billed for qualified education expenses. | Form 8863, Education Credits Form 1040, line 49 |
| Lifetime Learning Credit | Form 1098-T, provided by the educational institution, showing payments received or billed for qualified education expenses. | Form 8863, Education Credits Form 1040, line 49 |
| Employer-Provided Assistance | Amounts over $5250 should be included your wages on Form W-2 box 1. | Benefits up to $5250 are not reported as they are excluded from income. Benefits over $5250 included on Form 1040, line 7 (wages) |
| Early Distributions from IRAs that Avoid Penalty | 1099-R from IRA account, showing amount of distribution | Form 5329, Part 1 Form 1040, lines 15a and 15b |
| Student Loan Interest Deduction | Form 1098-E, provided by the bank or governmental agency to which you made loan payments that included $600 or more of interest. You may have deductible interest for which you do not receive a 1098-E. | Form 1040, line 33 Calculate using Student Loan Interest Deduction Worksheet found in Form 1040 or 1040A instructions. |
