Should I enter taxable scholarship in "Expenses and Scholarships (Form 1098-T)" or "Other income not already reported on a Form W-2 or Form 1099"?

[KrisD]

To report the scholarship as income on the student's return, please follow the instructions below. The income will be reported as earned income on 1040 line 7 or 1040A line 7 or 1040EZ line 1.

Sign into your account

Take me to my return

Pick up where I left off

Click open the search box

Type   education expenses   into the search box

Click "Jump to education expenses"

OR 

Click Federal Taxes 

Click Deductions & Credits

Scroll down to "Education"   Show more

"Expenses and Scholarships (Form 1098-T)"   Start

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You will need to walk through interview screens.

Answer "No" to getting a 1098-T since the student does not report this form.

Do not report any payments billed or paid.

When you get to the screen that asks "Did You Receive a Scholarship or Grant...?" Answer "Yes" and a drop down will open.

Enter the amount. 

(see screen shots below)

The amount of the scholarship will be added to line 7 with a SCH note.