1098T Information

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 (box2), 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. Based on Federal regulations, Financial Aid (grants, scholarships, loans) cannot be disbursed more than 10 days prior to the start of the semester.

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 two semesters (Fall and Spring) of charges (box 2) and one semester (Fall) of Scholarships or Grants (box 5).

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 Scholarships or Grants (box 5) for the Spring semester plus the next Fall semester, and assuming the students do not take any Summer courses, the 1098-T will also reflect charges (box 2) for the Fall and following Spring semester. [If they did attend during the Summer, the 1098-T would include those charges and any scholarships/grants.] And so it goes until the students graduate.

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 Scholarships or Grants (box5) only,due to the fact that the Spring charges were billed in December of their senior year and the financial aid was disbursed in January (the start of their final semester).

Xavier University cannot offer any 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 irs.gov and refer to IRS Publication 970 and Instructions for Forms 1098-E and 1098-T.

Here is a visual representation of the 1098-T process: