What you do depends on the numbers.
Example 1: Box 1 is bigger than box 5. Your expenses were greater than your grants. Your parents take the 1098T and the education credit, if eligible. The difference between box 1 and box 5 would be the education expenses.
Example 2: Box 1 is bigger than box 5. Your expenses were greater than your grants. Your parents take ALL of the education expenses(box 1) and you include box 5 in your income. This only works if your parents can claim the education credit. The credit to them is usually more than a little or no tax to you. Nobody uses the 1098T itself, just the information split between you.
Example 3: Come up with some combination of the first two that gives one of both of you the most advantage.
Example 4: Box 5 bigger than box 1. You take the 1098T onto your return. You have income of the difference. Nobody gets a tax credit.
IRS and Turbo Tax links:
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