Community Exchange

Hello,
We just converted to a new ERP this summer, which is impacting on how we process 1098T's.  We do not have a way to manually create 1098T's after we would publish them on the 1/31 deadline without creating a support ticket with our software company.  The issue is we have many students who supply their SSN after the 1/31 deadline for publishing the 1098Ts.  The majority of students providing their SSN after the deadline are international students.  We have a large international population, and I have seen online where some institutions produce 1098T's for domestic and international students.  I did try to contact the IRS multiple times regarding the questions below and no one was able to help.  
Is there an issue with submitting a file with international students who would have a blank SSN to the IRS if we attempted to contact the student to provide an SSN?
Is there a point in time if we attempted to contact the student for an SSN and they did not provide the SSN that we could tell the student a 1098T could not be created and provide them with a statement of their charges and payments instead of creating a 1098T?
Thanks for any advice you could provide.  

Hi Amanda,

That's a great question. We've faced similar challenges in managing 1098-T forms for international students, especially when SSNs or TINs are submitted after the January 31 deadline.

As you likely know, institutions are not required to file a 1098-T for nonresident alien students unless the student specifically requests one. That said, the IRS does allow institutions to include these students in the general filing with domestic students if they choose to do so. However, since filing for nonresident aliens is considered an exception to the filing requirement, we prefer to only create a form when the student formally requests it.

The reason for this is twofold:

• The IRS may assess a fine against students who fail to provide a valid SSN or TIN, and we want to avoid inadvertently triggering that.
• Waiting for a student's request ensures we have their identifying information and consent documented.

At Mercer, our process for international students is as follows:

• Each November, with sporadic reminders, we invite international students to submit a 1098-T request form.
• Upon receiving a request, we review their record. If an SSN/TIN is missing, we contact the student to obtain it.
• If they do not have one, we inform them of the potential IRS penalty and request that they complete a W-9 form instead.
• All 1098-T forms, including those for international students who have submitted requests, are made available in the student portal and mailed to students by the January 31 deadline to meet the IRS distribution requirement.
• Because many international students submit their requests after January 31, we hold our electronic IRS file until March 15 (the IRS submission deadline is March 31) so that we can manually add these students before transmitting the file.
• For any requests received after the March submission, we manually complete and mail paper 1098-T forms directly to the IRS.

You asked specifically about including students with blank SSNs. The IRS does not prohibit submitting a file that includes international students with missing SSNs if you've made a good-faith effort to obtain the information. However, in our experience, it's cleaner and more defensible to document your outreach and exclude them from the original submission unless they've provided the necessary identifiers.

If you haven't already, I'd recommend reviewing the Instructions for Forms 1098-T and General Instructions for Certain Information Returns (Forms 1096, 1098, 1098, 1099, 3921, 3922, 5498, and W-2G) on the IRS website, which provide excellent clarification on these exceptions and timing considerations.

I hope this helps!

Jessica Ellison
Assistant Vice President
Student Accounts
Mercer University
478-301-2134

Hello,
We just converted to a new ERP this summer, which is impacting on how we process 1098T's.  We do not have a way to manually create 1098T's after we would publish them on the 1/31 deadline without creating a support ticket with our software company.  The issue is we have many students who supply their SSN after the 1/31 deadline for publishing the 1098Ts.  The majority of students providing their SSN after the deadline are international students.  We have a large international population, and I have seen online where some institutions produce 1098T's for domestic and international students.  I did try to contact the IRS multiple times regarding the questions below and no one was able to help.  
Is there an issue with submitting a file with international students who would have a blank SSN to the IRS if we attempted to contact the student to provide an SSN?
Is there a point in time if we attempted to contact the student for an SSN and they did not provide the SSN that we could tell the student a 1098T could not be created and provide them with a statement of their charges and payments instead of creating a 1098T?
Thanks for any advice you could provide.  

Great answer Jessica!

Texas Tech follows these same "best practices" with just a few exceptions. Since we publish our 1098T forms in-house, there is little to no extra cost to run them for all students (including exclusions for NRA and Box 5 > Box 1). We will publish them for online access and printing as early in January as possible for all students who have signed our Global Electronic Consent (GEC). 

For students who have not accepted the GEC, we will mail those no earlier than January 31st. We consistently remind students that by simply accepting their GEC online, they could have the document much earlier. For the ones that get mailed, we will not mail to international addresses or for those NRAs that were missing SSNs. We are able to update them and print them in house if they come in to provide an SSN and request one. We will only update and republish/print up to the point we submit our file to the IRS at the end of March. If they provide updated documentation after that, we remind them that this in an informational return only and we are not required to issue corrected forms unless an amount is actually wrong. Even for incorrect SSNs, the IRS will try to match forms two ways; first by SSN and if that does not match, they match on first/last name. 

Since we do at least two solicitations for missing or incorrect SSN's, we check the box on our IRS file and will not issue forms for those corrections since we made our solicitation. Also, you are not required to issue a 1098T with an SSN/ITIN that is issued after your form was created. 

Because your system does not allow creation of a manual form, I would highly suggest generating for all international students but limiting costs by not publishing or mailing whenever possible. Due to the requirement that you must provide a form when one is requested, it could save a lot of headaches. I have also been know to ask a student why they need one. If they have not worked in the US and do not have any taxes withheld that could be claimed in a refund, if they simply want one because someone told them to get one (likely a fraud attempt) or because their friend got one (not relevant), then I can usually clarify why they do not need one. Our tax dept will also manage any NRA withholdings related to scholarships that exceed T&F. The student needs that 1042-S to file a claim to return withheld funds but that is outside the purpose of the 1098T.

As we may be in the market for a new ERP at some point, I would be interested to know what ERP you are using. Maybe their is another workaround we can suggest.

Hello,
We just converted to a new ERP this summer, which is impacting on how we process 1098T's.  We do not have a way to manually create 1098T's after we would publish them on the 1/31 deadline without creating a support ticket with our software company.  The issue is we have many students who supply their SSN after the 1/31 deadline for publishing the 1098Ts.  The majority of students providing their SSN after the deadline are international students.  We have a large international population, and I have seen online where some institutions produce 1098T's for domestic and international students.  I did try to contact the IRS multiple times regarding the questions below and no one was able to help.  
Is there an issue with submitting a file with international students who would have a blank SSN to the IRS if we attempted to contact the student to provide an SSN?
Is there a point in time if we attempted to contact the student for an SSN and they did not provide the SSN that we could tell the student a 1098T could not be created and provide them with a statement of their charges and payments instead of creating a 1098T?
Thanks for any advice you could provide.  

It is optional to issue a 1098-T to international students. However, you decide to issue one and as long as you do your due diligence in soliciting  their SSN/TIN using a written documentation ( using the IRS W9-S or its substitutes), then you can check off TIN Certification Box Code on IRS file and there should not be a problem.

If you get audited by IRS for filing with no SSN , then you can show them you have done your due diligence to collect the SSN/TIN ... IRS used to audit actively ( most likely with automated audit ) and penalizing schools but with many schools complaining the penalty, it has stopped and the IRS introduced the self-certification  indicated in  TIN Certification Box Code on IRS file transmitted ( if your are colleague school , that will be T9TM  and configures on T9TD/T9TE) and if you are using a vendor , make sure you prepared your file per https://www.irs.gov/pub/irs-pdf/p1220.pdf 

Hello,
We just converted to a new ERP this summer, which is impacting on how we process 1098T's.  We do not have a way to manually create 1098T's after we would publish them on the 1/31 deadline without creating a support ticket with our software company.  The issue is we have many students who supply their SSN after the 1/31 deadline for publishing the 1098Ts.  The majority of students providing their SSN after the deadline are international students.  We have a large international population, and I have seen online where some institutions produce 1098T's for domestic and international students.  I did try to contact the IRS multiple times regarding the questions below and no one was able to help.  
Is there an issue with submitting a file with international students who would have a blank SSN to the IRS if we attempted to contact the student to provide an SSN?
Is there a point in time if we attempted to contact the student for an SSN and they did not provide the SSN that we could tell the student a 1098T could not be created and provide them with a statement of their charges and payments instead of creating a 1098T?
Thanks for any advice you could provide.