You ignore that part. You already know that you don't qualify for the education credit. The 1098-T is only any informational document. The numbers on it are not required to be entered onto your tax return.
If you have already entered it; click the delete button next to the student's name at the education summary page.
But, there is a tax “loophole” available. The student reports all his scholarship, up to the amount needed to claim the American opportunity credit, as income on his return. That way, the parents (or himself, if he is not a dependent) can claim the tuition credit on their return. They can do this because that much tuition was no longer paid by "tax free" scholarship. You cannot do this if the school’s billing statement specifically shows the scholarships being applied to tuition or if the conditions of the grant are that it be used to pay for qualified expenses.
Using an example: Student has $10,000 in box 5 of the 1098-T and $8000 in box 2. At first glance he has $2000 of taxable income and nobody can claim the American opportunity credit. But if he reports $6000 as income on her return, the parents can claim $4000 of qualified expenses on their return.
