Received a scholarship for my medical school that is being considered as income by turbotax. The scholarship was entirely used to pay for tuition. Is this correct?

[Nathan-R-]

The 1098T just lists box 1 with the leftover of the tuition that I paid with Box 5 showing the amount for the scholarship, which is greater than what I paid the school for the remaining balance of tuition. This amount is being added onto my income essentially doubling my income and leading to me having to pay the IRS instead of receiving a refund.

[KittyM · Accepted solution]

Enter your 1098-T exactly as you see it on the form. Your qualified education expense includes all amounts paid to the school whether through scholarships, grants, student loans, or your own funds. Only the amounts you actually paid (not the amounts billed) qualify for the credit.

If either box 1 or 2 does not reflect your total tuition expense, select What if this is not what I paid to this school? below box 2 to enter the correct amount

Only if your grants and scholarships exceed your actual tuition paid will you have taxable scholarship income.