I have excess scholarships/grants (Pell grant and Navy Tuition Assistance) and was wondering if the the Navy TA qualifies as tax-free employer assistance?

[Bharris9544]

I am working on my taxes and am currently on my 1098-T. My amount billed for qualifying expenses in box 2 is: $7,750.00. My total scholarships in box 5 is $12,736.00. My scholarships/grants for 2017 were the Pell Grant : $7,236.00. The other $5,500.00 was from Navy Tuition Assistance. My question is after I input my 1098-T i see:

"Tell us if the scholarship amount from Box 5 of Brandon's 1098-T includes any of the following:              GI Bill benefits         Veterans' benefits         Tax-free employer provided assistance"

Would my Navy TA ($5500) count as tax-free employer provided assistance?

Also, should I be reporting the excess of my grants/ schlorships under income or will TurboTax automatically do that? Thank you!

[Vanessa]

You will select Yes, that the benefits were one of the above and then enter the $5,500 that was from the Navy Tuition Assistance. 

TurboTax will automatically calculate any overages you may have. 

Payments you receive for education, training, or subsistence under any law administered by the Department of Veterans Affairs (VA) are tax-free. Don't include these payments as income on your federal tax return.https://www.irs.gov/publications/p970#en_US_2017_publink1000204353

[Bharris9544]

Would this be true even if I was still active duty? I believe the funds come directly from the Navy and not the VA since I am not using my GI Bill.

[Vanessa]

Yes, all all military educational benefits are treated the same.