1098-T is adding income to my total income

[acescapita]

Hello,

I am a graduate student and I make $30,000 per year. On my current taxes, it says that my total income is saying $30,485. I believe that this $485 is coming from my 1098-T because the difference between Box 1 and Box 5 is $485. Box 1 says my tuition was $9,978 and Box 5 says $10,463. I receive a stipend every month of $2500, and I have never received the $485 from my scholarship. I receive my stipend through a grant that my mentor gets from the university. How can I remove this extra amount from my income? Thank you! 

[Hal_Al · Accepted solution]

Q. How can I remove this extra amount from my income?

A. You remove it by never entering it.

TurboTax is doing it correctly. The difference between box 5 and box 1 is taxable, unless you enter additional expenses to off set it (e.g. books & computers). 

But, The 1098-T is only an informational document. The numbers on it are not required to be entered onto your tax return. However receipt of a 1098-T frequently means you are either eligible for a tuition credit or possibly your student has taxable scholarship income. If you're not claiming either, just don't enter the 1098-T.

If you claim the tuition credit, you do need to report that you got one or that you qualify for an exception (the TurboTax interview will handle this)

You claim the tuition credit, or report scholarship income, based on your own financial records, not the 1098-T. In the 1098-T screen, click on the link "What if this is not what I paid the school" underneath box 1. You will then be able to enter the actual amounts paid. You will also reach a screen that allows you to adjust the scholarship amount for "amounts not awarded for 2022 expenses".

Or if you find it easier, just change the numbers in boxes 1& 5 to what your records show. The 1098-T that you enter in TT is not sent to the IRS

[acescapita]

Great! Thank you so much for your help!