1098 T

Ignore numbers on the 1098-T and work from your financial records with the school(s).

The fact that you're mentioning loans tells me you need to do some research in IRS Publication 970. When you're figuring tax benefits from higher education expenses it's irrelevant whether an expense was paid from a loan or from savings.

Unfortunately, I too have found 1098-T to be worse than useless in many cases. Because the tax reductions (or, subsequent credit recaptures) involved can easily range into several thousand dollars, having to deliberately ignore an official IRS reporting document is especially annoying.

One local community college, where full-time tuition might be on the order of $600/yr, recently sent a 1098-T with about $4,500 in both box 2 and box 4 (adjustments for prior year), both numbers being completely fictional. Later a correction was received, still no box 1 and still inaccurate numbers in the other boxes.

Another large state university system does not issue 1098-T at all. On the plus side, students there can log in and get a complete statement of account online (all charges, payments, and refunds).

-Mark Bole