How much of scholarships do you want to allocate to "room and board and noneducational expenses?"

[MarilynG1]

If you paid more Tuition than what is indicated in Box 1 on Form 1098-T, click the link under the entry field that says 'what if this was not the amount paid to the school'.

A field will open up for you to make your entry of the correct tuition amount.

@MidMoMom24 

[MidMoMom24]

@MarilynG1 

We didn't actually pay more tuition than listed on the 1098-T
But Hal_AI had given me a way to figure things to get the AOTC. He said to take the scholarship that was restricted to tuition only ($16950) and subtract it from the total scholarship received ($18840) which gives a balance of $1890 left of tuition money that can be used to figure the AOTC - (he had given instructions on how to use that to receive the AOTC credit), but I am not find where to enter the $1890 amount.  So I am a bit stuck now. Is there a way that you know of to do this?

Thank you for trying to help me. I am stuck currently and was hoping to figure this out in time to file.

[Hal_Al]

Enter the 1098-T, on your return, with $1890 in box 1 and box 5 blank.  Enter the $1538 in the books section.  That should give you $3428 Total net expenses for the AOTC, resulting in a credit of $2357. 

Form 8863 does not break down expenses. If you were entering numbers directly on form 8863, you would enter only $3428 as Adjusted qualified education expenses on line 27.  So, an even shorter short cut, in TT, is enter the 1098-T with $3428 in box 1 of the 1098-T , 0 in box 5, and not bother with any other entries. 

[MidMoMom24]

@Hal_Al 

I tried that...and it gives me an error when I try to allocate to the R&B amounts, saying I need to fix the zero balance of scholarship if I want allocate to R&B.

Is there another way to try this? Or to show the $1890 where it needs to be? Without the $1890 showing somewhere on the 8863 does that mean we cannot take the AOTC? 

[MidMoMom24]

@Hal_Al 
Its still giving me the error and asking me to 'zero out' line Line 4 (what we allocated for R&B) as it cannot be larger than line 2c (which is zero for $0 "Scholarships, fellowships, and grants not reported on Form W-2").

Does the $1890 need to show anywhere in the forms for us to qualify for the AOTC?

If not, I can just increase the R&B to offset the amount needed to get the AOTC (because our student doesn't have an income amount, so no need to file taxes for him) , but I don't want to do that if its wrong or will create an error or red flag somewhere along the way.

[Hal_Al]

Q. Is there another way to try this?

A. Yes.

You're getting bogged down in entry details and it messing things up. Your chances of getting TT to do this right in the standard interview are slim. You need to use a short cut. This thread is long and convoluted and I'm involved in several others, so I don't have all your details sorted out in my head. But, I think this is where we are:

It can be simplified, because you appear to have the bottom line numbers. 

  -You have $3428 of adjusted qualified expenses for the AOTC

  -The student needs to report $4350 of taxable scholarship, if he is even going to file

Delete everything, in the  1098-T sections,  on both your return and the student's return. On your return, re-enter the 1098-T with $3428 in box 1 and box 5 blank.  Re-enter the 1098-T, on the student's return with $4350 in box 5 and 0 in box 1.  Enter no other numbers. 

[MidMoMom24]

@Hal_Al 

Okay, thank you. I just was not sure where else the numbers I key in from the 1098-T go? I was not sure if the software populates it in other areas? (like 1040 or anything like that, and didn't want to enter anything in that was not accurate for the IRS). I have even tried keying our taxes into 3 other online software's trying to make this work. Its been a longggg week. I really appreciate you taking the time to help.

I did try what you mentioned and it dropped the refund another $88, so I am not sure what I have done here? But I think you're right, its become long and complicated for sure, so I am likely messing something up along the way on my end.

IF I enter $1623 for the "qualified books & equipment" (and leave off the $1890 of the remaining tuition and QEE that there is no blank for) and $4350 for R&B and leave the 1098 as it is (with $18840 in tuition, $16950 of that strictly for tuition, that leaves me the $4350 for R&B) then if I enter in the listed $21,300 for scholarships received.

It gives me an AOTC credit of $2,378 - I am okay with that (and it shows $3513 on the worksheet as QEE on the tax program that lets me view the 8863 form - so it must have a way to calculate/add in that $1890 that I am not aware of). I just didn't want to leave $2,500 on the table, I can live with leaving the extra $122. It is frustrating that I cannot figure out what I am doing and where, no fault of yours - you've been a great help. 

Also, I do not have a 1099-Q, so I think I am okay there?

And our student only has $1000 in income, so I think we are safe not filing anything for them also?

(I will try to add a pic of the worksheet amounts I am referencing from the 8863 worksheet it produced.)

[Hal_Al]

I'm not sure how you did it, but you were apparently successful at arriving at the correct outcome (+/- $2378 AOTC).

I deleted my reference to 1099-Q. It doesn't apply in you case (I mixed you up with another thread).

Q. Our student only has $1000 in income, so I think we are safe not filing anything for them also?

A. Yes.  

[MidMoMom24]

@Hal_Al 

At this stage, even Im not sure how I did it?

My only hope is that it's right. 🙏

Does that AOTC amount sound about right for our numbers?

$21,300 in scholarships ($16950 restricted to tuition only leaves $4350 for R&B)

$18,840 in QEE from 1098 (tuition & univ fees)

$1623 additional QEE (books & equipment)

$4350 of scholarship money allocated to R&B

It created 2 worksheets to populate the 8863, this is the second one. Does it seem to look ok to you? (These numbers below don't make any sense to me, the first worksheet did. But as long as it's accurate I'm ok. I'm not trying to get more than we're owed, just don't want to lose what's ours. ) And thank you again!

[Hal_Al]

Q. Does that AOTC amount sound about right for our numbers?

A. Yes.

[MidMoMom24]

@Hal_Al 

Awesome! Thank you so much! And bless you for answering all my questions with kindness & patience and verifying afterwards. I know its just words, but you were a HUGE help! And I greatly appreciate you. 😊