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Where can I input taxable scholarship income in the turbotax software? I did not receive a 1098-T because I received more scholarship money than the cost of tuition

 
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2 Replies
MaryK4
Expert Alumni

Where can I input taxable scholarship income in the turbotax software? I did not receive a 1098-T because I received more scholarship money than the cost of tuition

To enter in TurboTax so that it is on Line 1 with the SCH designation, follow these steps:

  1. Go to the Federal - Deductions & Credits.
  2. Scroll down to Education.
  3. Click Start or Revisit next to Expenses and Scholarships (Form 1098-T).
  4. Answer Yes to "Did you receive a 1098-T?" even though you didn't.
    • Note: TurboTax needs you to say "Yes" to trigger the manual entry screens.
  5. On the next screen, select "I did not receive a 1098-T" and click Continue.
  6. The software will ask for your school's info. Enter it and continue.
  7. You will reach a screen asking for Scholarships and Memorial Grants. Enter the total amount of scholarship money you received there.
  8. A few screens later, it will ask for your Educational Expenses (Tuition and Books). Enter what you actually paid.  If you know the taxable scholarship amount and are not claiming education credits, you can just enter the taxable scholarship amount for Box 5.  
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Hal_Al
Level 15

Where can I input taxable scholarship income in the turbotax software? I did not receive a 1098-T because I received more scholarship money than the cost of tuition

Enter at Educational Expenses and Scholarships, under Deductions and credits (not the income section). After answering no to having a 1098-T, answer yes to qualifying for an exception (that gets you to the entry screens). You will have to go thru the whole education interview to get to the scholarship screen. At the scholarship screen, enter the amount of the grant. When asked if any was used for room and board, answer yes. Then enter the amount you want to be taxable, in the pop up box. R&B are not "qualified educational  expenses".  So, this is how you tell TT that it is taxable. Note the wording at that screen “or other expenses”. You didn’t have to literally use the scholarship for R&B.  This will put it on line 8r of Schedule 1.

 

Here's a post on the five main points on the  1098-T (and educational expenses in general). In particular, note the "loop hole":

https://ttlc.intuit.com/community/college-education/discussion/re-what-do-i-do-with-form-1098t/01/37...

 

Scholarships are a hybrid between earned and unearned income. It is earned income for purposes of the $15,750 filing requirement (2025) and the dependent standard deduction calculation (earned income + $450).  It is not earned income for the kiddie tax and other purposes (e.g. EIC).  For grad students and post grad fellows, scholarship, stipend and fellowship income is earned income ("compensation") for IRA contributions.

 

Taxable scholarship goes on line 8r of Schedule 1, from which TT treats it as hybrid income.

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