Here is a brief explanation of Xavier University's 1098-T process. Please keep in mind that most of the confusion surrounding the actual amounts listed on the 1098-T is the result of combining the calendar year with the academic year. They are two separate years in the eyes of the IRS.
The IRS states in its Publication 970, "An institution may choose to report either payments received (box 1), or amounts billed (box 2), for qualified education expenses." As a result, Xavier University has decided to report amounts billed (box 2).
Xavier University sends out monthly invoices to its students. Summer semester charges are included in the May invoice, Fall semester charges are included in the July invoice, and Spring semester charges are included in the December invoice. Spring semester charges are reflected as "Future Charges" on the December eBill and for tax purposes will have an effective date of the following tax year. For example, Spring semester charges that appear on a December 2013 eBill will have effective dates of January 2014 and will be accounted for in the 2014 tax year. Therefore, typical freshmen who begin their college careers in the Fall semester, will receive a 1098-T for that calendar year (not academic year) reflecting one semester (Fall) of charges (box 2) and one semester (Fall) of Scholarships or Grants (box 5).
Based on Federal regulations, Financial Aid (grants, scholarships, loans) cannot be disbursed more than 10 days prior to the start of the semester.
For the next calendar year (the students' second semester as freshmen and first semester as sophomores), the students will have a 1098-T that reflects Amounts Billed (box 2) and Scholarships or Grants (box 5) for the Spring semester of their freshman year plus the Fall semester of their sophomore year. If they did attend during the Summer, the 1098-T would include those charges and any scholarships/grants. And so it goes until the student graduates.
Once they graduate in May of their final academic year, they will receive a 1098-T at the beginning of the following calendar year for the previous calendar year (the calendar year in which they were seniors during the Spring semester). It will reflect Amounts Billed (box 2) and Scholarships or Grants (box5) due to the fact that the Spring charges and financial aid/payments were billed in the calendar year of their last semester.
Xavier University cannot offer tax advice. For further assistance, please contact your tax professional or the IRS at 1-800-829-1040. You can also visit the IRS website at www.irs.gov and refer to IRS Publication 970 and Instructions for Forms 1098-E and 1098-T.