Limited Penalty Reflief for 2016 Form 1098-T Filers

By McClintock & Associates | December 8, 2016

By Mike Rager, CPA

The Internal Revenue Service (IRS) issued Announcement 2016-17 on April 27, 2016, providing notice that the IRS will not impose penalties for reporting the amount billed rather than amount paid for qualified tuition and related expenses on Form 1098-T, Tuition Statement. This will only be available for the 2016 forms and will not provide relief for other penalties related to the forms.

Prior to the Protecting Americans from Tax Hikes Act of 2015(PATH) passed in December 2015, educational institutions were permitted to report either amounts billed or amounts paid. The amounts billed option was eliminated by PATH, so going forward with the 2017 forms, educational institutions will need to report based on amounts paid.

Also, for guidance on potential correction or relief for other types of Form 1098-T filing problems, please see our prior Tax Article (We Forgot to File 1098-Ts – What Do We Do?) in the Winter 2016 issue of the McClintock Minute. Please feel free to reach out to us for assistance with any questions or issues you may have.

Volume 3, Issue 3
Summer 2016

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