According to the Taxpayer Relief Act (TRA) of 1997, the Hope Scholarship is a tax credit available to the taxpayer for qualified tuition and related expenses.
The taxpayer may be the student claiming federal tax return, or the parent of the student claiming the student as a dependent on a federal tax return. The student must have a high school diploma or its equivalent and be enrolled part-time or more in a program that leads to a degree or certificate for at least one academic period during the tax year.
The Hope Scholarship tax credit can be claimed only for two tax years and applies only to the first two years of postsecondary education. A student cannot have a drug felony conviction on possession or distribution in a year that the tax credit is claimed. Education expenses paid on or after January 1, 1998, may be eligible for Hope credit.
The credit is taken in the year expenses are paid and education either begins that year, or the first three months of the following year. Before calculating the credit, the taxpayer must deduct any scholarships and other tax-free financial assistance, including a Federal Pell Grant and employer - provided educational assistance. However, educational expenses paid for with loans are eligible for these tax benefits. The credit is indexed for inflation. Refer to IRS Form 8863 for the maximum credit amounts for your tax return.
What You Need to Do
- Make sure that the College Admissions and Records office has an accurate Social Security Number (SSN) or Individual Taxpayer Identification Number (ITIN).
- Make sure that the College has a current address for you and any individual who can claim you as a dependent on the federal tax return.
- For each tax year, keep copies of documents related to payment of qualified tuition and fees, such as canceled checks or credit card statements, financial aid awards, scholarships received and employer-paid tuition benefits.
- Obtain relevant IRS forms and documents, such as IRS Publication 970, Tax Benefits for Higher Education and IRS Publication 4, Student's Guide to Federal Income Tax. For forms information call: 1.800.829.3676 | For more information call: 1.800.829.1040 (You need Adobe Acrobat to read the forms.)
- Visit the IRS website for more information.
- NOVA Tax Information Office
- 8:30 a.m. to 5:00 p.m., Monday - Friday, February 1 - April 15
- If you have questions about the information reported on your 1098-T for the Hope or Lifetime Learning Tax Credits, call the NOVA Tax Information Office for assistance.
- If you have questions about interest deductions for qualified student loans that were reported on your 1098-E, call University Accounting Service Inc. at 1.800.999.6227.
- If you need a copy of a receipt for qualified expenses for credit or non credit enrollment, call the NOVA Tax Information Office for assistance.