TT incorrectly handling scholarship as income on web version

[mk89]

Very straightforward.  No 529s, no overlapping years.  Full time grad student paying mostly from savings.  Income on W2 of $4,500.  1098-T shows 23,500 in box 1 and 8,000 in box 5. Box 1 exceeds Box 5 so no taxable income.  Turbo tax shows it as other income and carries it through to be taxable on a state return.  I am pretty sure I can just leave the 1098-T out as nothing is taxable and I also know I am not going to get an education credit but prefer to know why it is doing this.

Any ideas why?  Thanks

[AmyC]

Clearly box 1 is greater than box 5. Not being able to see your program, I can only guess that something got marked that should not have which disqualified your educational expenses. As a grad student, you may qualify for the LLC. 

The 1098-T is an informational form and is not required to be filed.

The credit and income limits:

• For the full credit, your MAGI (modified adjusted gross income) is less than $80,000 ($160,000 if you're filing jointly)
• For a reduced credit, your MAGI is between $80,000 and $90,000 ($160,000 and $180,000 if you're filing jointly)
• There is no credit given if your MAGI is above $90,000 ($180,000 if you’re filing jointly)

Reference IRS Q & A about education credits

[mk89]

Thanks.  Took the 1098-form out last night when it didn't work correctly.  Put it back in this afternoon after I posted and it worked correctly.  Nothing done differently other than a different day.  Thanks for the quick response.