1098 T Excess Scholarship: File or not?

[fnlopez317]

My son has $15,266 in scholarships to count as income but only earned $3558 from his job.  He doesn't have to file based on earned income but should file because no taxes were paid on the scholarship money.  I'm not sure whether he should file as having $18K in taxable income or not file because he didn't make enough earned income. 

[Ashby · Accepted solution]

First, you want to be certain that his scholarships exceed his Qualified Education Expenses by $15,266. If this is the case you will report the 1098-T in the education section and the W-2 in the wages section. Since the income, added together, meets the threshold, he will have to file. 

Here's the info about Qualified Education Expenses to make sure you counted everything:

• Tuition
• Enrollment fees
• Expenses paid to school, on condition of enrollment (lab fees, for example)
• Certain books, supplies, and course-related equipment
• Expenses listed above (for the following semester), as long as the semester begins in the first three months of 2019
• Education expenses paid with cash, checks, credit cards and savings accounts
• Education expenses paid with loans, gifts and inheritances