IRS penalty relief concerning Forms 1098-T | KPMG | GLOBAL

IRS penalty relief concerning Forms 1098-T, Tuition Statement

IRS penalty relief concerning Forms 1098-T

The IRS today released an advance version of Announcement 2016-17 offering limited relief from penalties for eligible educational institutions with respect to the Forms 1098-T required to be filed for the 2016 calendar year under section 6050S.


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Announcement 2016-17 [PDF 13 KB] provides notice that the IRS will not impose penalties under section 6721 or 6722 on eligible educational institutions with respect to Form 1098-T, Tuition Statement, required to be filed and furnished for the 2016 calendar year under section 6050S if the institution reports the aggregate amount billed for qualified tuition and related expenses on Form 1098-T, instead of the aggregate amount of payments received as required by section 212 of the Protecting Americans from Tax Hikes Act of 2015. The penalty relief is limited to 2016 Forms 1098-T required to be filed by eligible educational institutions by February 28, 2017 (or March 31, 2017, if filed electronically), and furnished to recipients by January 31, 2017. Today’s IRS announcement does not provide penalty relief for any other failure that would cause a filer to be subject to penalties under section 6721 or 6722, or any other penalty under any provision of the Code.


Colleges and universities are required annually to notify students enrolled in degree programs of the costs to attend their institutions of higher learning by furnishing them Forms 1098-T, Tuition Statement. Form 1098-T provides students with tuition information that can assist them in claiming educational tax credits on their individual income tax returns. Legislation was enacted in 2015 affecting Form 1098-T. The IRS responded with a revised form for tuition payments made during calendar year 2016. Read a March 2016 report [PDF 179 KB] prepared by KPMG LLP.


For more information, contact the Managing Director-in-Charge of KPMG's Washington National Tax Exempt Organizations Tax group

D. Greg Goller |  +1 (703) 286- 8391 |

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