scholarship money

Forum|Forum|5 years ago
March 10, 2021
1 reply
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My daughter's 2020 1098-T reported 9613 of qualified tuition expenses and 11400 of scholarships. However, only 6400 of the scholarships was used for 2020 qualified expenses. The remaining 5000 will be used on 2021 spring semester tuition. Can 6400 of the scholarship be reported on the 2020 return since this was the amount that was used for 2020 qualified expenses or does the full 11400 have to be reported on the 2020 return? If I have to report the full 11400 on the tax return, then we will have taxable income. Would she report the taxable income on her tax return or would I? We are claiming her as a dependent and she has no other income.

Hal_Al

Level 15

Q. Can 6400 of the scholarship be reported on the 2020 return since this was the amount that was used for 2020 qualified expenses or does the full 11400 have to be reported on the 2020 return?

A. Report only the $6400. You will reach a screen that allows you to adjust the scholarship amount for "amounts not awarded for 2020 expenses". Or you can you can just change box 5 to $6400.

Be sure to keep track of the adjustment for next year.

Q. Would she report the taxable income on her tax return or would I?

A. If any of her scholarship is taxable, it goes on her return. If she has no other income, she does not need to report taxable scholarship under $12,400.

lorettawaynepark20Author

Level 2

Thank you. I adjusted her scholarship amount by 5000. She also has a qualified education plan and she received a 1099-Q. From my understanding, the beneficiary/recipient, which would be my daughter, has to report the info from the 1099-Q on her return, not our return...is this correct? The distribution amount in Box 1 is 2031 and the earnings amount in Box 2 is 1249. Her qualified expenses are 9613 and her scholarships are 6400 leaving her an adjusted qualified expense amount of 3213. Since the distribution amount is less than her adjusted qualified expenses, does she need to report the info from her 1099-Q on her return?

macuser_22

Alumni - Champ

We took money from a retirement account during the 2020 year and we received a 1099-R. A portion of the distribution on the 1099-R (14000) was deposited into a traditional IRA in April 2020 but for 2019. This 14000 was deducted as an IRA deduction on our 2019 tax return to lower our taxes. I am entering the info from our 1099-R on our 2020 tax return and I got to this question:

Tell us if you moved the money through a rollover or conversion

We need to check if you moved any of this money into another retirement account (or returned it to the same account). In some cases, this can lower your tax liability.

I rolled over some or all of it to an IRA or other retirement account within the time limits (normally 60 days)

I converted some or all of it to a Roth IRA

I did a combination of rolling over and converting some or all of this money

I didn't rollover or convert this money

Do I need to check the first one...I rolled over some of it to an IRA? I'm thinking I need to check the last one and say I did not rollover any of the money since the 14000 was deposited for 2019 and claimed on the 2019 tax return but I wanted to make sure. Please advise.

@lorettawaynepark20 wrote:

We took money from a retirement account during the 2020 year and we received a 1099-R. A portion of the distribution on the 1099-R (14000) was deposited into a traditional IRA in April 2020 but for 2019. This 14000 was deducted as an IRA deduction on our 2019 tax return to lower our taxes. I am entering the info from our 1099-R on our 2020 tax return and I got to this question:

What you are saying is not allowed. A retirement distribution from a qualified plan can be rolled in to a Traditional IRA within 60 day of the distribution or if a box 7 code G, when the check is delivered to the receiving IRA. A rollover is NOT a new contribution that can be applied to 2019. You can make a 2019 contribution up to $6,000 ($7,000 of over ate 50) but it must come from earned compensation (money you worked for).

Unless the 1099-R box 1 money (or a part of it) was rolled into a IRA on 2020 within 60 days then is is not a rollover.

**Disclaimer: This post is for discussion purposes only and is NOT tax advice. The author takes no responsibility for the accuracy of any information in this post.**