I amended my tax return to add a 1098-T form and was told I owe $50 for federal and state taxes

[Kay98]

The tuition in box 1 was lower than the scholarship in box 5. I just wanted to make sure I did everything correctly for my taxes. Initially I filed my taxes early and had to amend it because the 1098-T came in the mail later. Would I owe money since the scholarship is larger than the tuition?

[Kay98]

Any help on this would be great, I'm just confused on why I had to pay back $50 for federal and $50 for state and turbo tax never really explained what it was for..

[Hal_Al · Accepted solution]

Q.  Would I owe money since the scholarship is larger than the tuition?

A. Yes. 

Scholarships that pay for qualified educational expenses (QEE - tuition, fees, books, a computer and other course materials) is tax free.  Scholarship amounts that exceed QEE is taxable income, on the student’s tax return. Room & board are not QEE.

If box 5 of the 1098-T exceeds box 1, TurboTax (TT) will treat the difference as taxable income, unless you enter additional QEE at books and other expenses.

[Kay98]

Thank you so much for your reply, I was just really confused on that part.

Do you know why it would be $50 for federal and $50 state? I tried going back into TurboTax to find out why, but they had me download a Michigan individual income tax payment voucher form. Is it because I got my state refunded to the bank before they could make the changes when I amended?

[Hal_Al]

I'm not familiar with Michigan.

[Kay98]

No problem 👍 thank you again for all your help. Very appreciated.