Q. Can I enter 1098-T information (for purposes of receiving credit) for the child that I do NOT claim as a dependent?
A. No. The child must be your dependent to claim a tuition credit or deduction.
But, if you are the recipient of a 1099-Q, you may claim some of the expenses on the 1098-T, to get an exclusion of some of the earnings (box 2 of the 1099-Q) from being taxed. If the student (or other parent) is claiming the credit, this will take some coordination between the twoof you, as "double dipping" is not allowed.
Total qualified expenses (including room & board) less amounts paid by scholarship less amounts used to claim the Tuition credit equals the amount you can use to claim the earnings exclusion on the 1099-Q.
Example:
$10,000 in educational expenses(including room & board)
-$3000 paid by tax free scholarship
-$4000 used to claim the American Opportunity credit (on the student’s return)
=$3000 Can be used against the 1099-Q
Box 1 of the 1099-Q is $5000
Box 2 is $600
3000/5000=60% of the earnings are tax free
60%x600= $360
You have $240 of taxable income (600-360)
