TurboTax ask me this question:
Did you receive a scholarship or grant in 2019? note: enter the amount you received. DON'T INCLUDE AMOUNTS ALREADY LISTED ON A w-2 or OTHER TAX FORMS.
I did receive $5250.00 in 2019. However the amount is not listed in a specific box in my W-2.
extra information: MY 1098-T box 1 shows $5004. Also, I spent $633 on supply & books.
Do I need to report the $5250 where I have been asked this question?
I have read so many articles that explains it differently.
It depends. The ultimate resource would be directly from the IRS itself.
Please see IRS Publication 970 Tax Benefits for Education starting on page 65 for Employer-Provided Education Assistance. It would appear that the only amount eligible for you to claim for an education credit, presuming the books were required and presuming you have already completed the first four years of post-secondary education, would be 20% of eligible costs: (($5,001+633)-($5,250))*20% for the Lifetime Learning Credit (see page 22 of the link above)
Lifetime Learning Credit, page 25, states Related expenses. Student activity fees and expenses
for course-related books, supplies, and equipment are included in qualified education expenses only if the fees
and expenses must be paid to the institution for enrollment or attendance.
[Edited 4/14/2020 | 9:15 AM PST]
You are correct. Any amounts of employer reimbursements up to 5250 that you exclude from income to cover any qualified education expenses cannot be used as a basis for other credits such as the Lifetime Learning Credit.
**Mark the post that answers your question by clicking on "Mark as Best Answer"