Understanding the 1098-T Form
Students receive a form 1098-T that is generated by the University in order to claim certain educational credits. While Cornell staff are not legally able to provide tax advice because each student’s circumstances will be different, we can explain what you can expect to see in the boxes and what that information might mean. Only a trained, certified tax advisor can provide appropriate individual guidance for you. It’s important to remember that the 1098-T is an information form only, and does not directly define taxable income or eligibility for a credit. Students may need to provide copies of their bursar bill to their tax preparer to confirm the dates that stipends were refunded.
Box 1 displays the total tuition costs and required fees that were paid during the tax year. Some students who self-pay these expenses may be able to claim a tax credit such as the American Opportunity Credit, the Hope Credit, or the Lifetime Learning Credit, based on this amount. Student Health Plan costs are not included in box 2.
Box 5 displays the total of all scholarship and fellowship awards.
Note: Bills for the spring semester are sent out by the university in the prior December, and spring-semester grants and fellowships are usually applied to the bill at that time. For a given tax year, box 1 and box 5 may include portion of the next spring semester bill. If a student’s spring semester fellowship award was changed after January 1st, that change would not be reflected in the current-year 1098-T but would instead be reflected in the next year’s form.
Students who receive scholarship or fellowship will see the sum of their eligible awards reported in box 5 on the 1098-T. Fellowship and scholarship support is generally tax-free when applied specifically to the cost of tuition, required fees, books and some required course supplies or equipment. Health insurance is not typically considered to be a “required fee” because at Cornell, like most universities, students must have insurance but not all students are required to buy the policy if they have another acceptable plan.
Perhaps you’ve seen online discussions suggesting that even experts don’t always agree on this. If you are working with a tax advisor you can refer her or him to University policy 1.3 on graduate assistantships. It describes how Cornell assistantships both require and provide coverage in the Student Health Plan, as a condition of the appointment, but not specifically as a condition of being a PhD student.