1098-T box 1 causing extra income

Forum|Forum|6 years ago
February 29, 2020
1 reply
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Box 1 of my 1098-T is the amount I personally paid to the school. Box 5 is the amount of scholarships I received. No where on this form is the actual cost of the school, except that it is Box 1 + Box 5. However Turbotax comes up with some random number on my “Wages, Salaries, & tips Worksheet” under line 13 “Scholarship/fellowship income not on Form W-2”.

So Turbotax seems to think that because line 1 is less than line 5 I have extra income?

How do I get rid of this extra income as it shows up on line 1 of the 1040 as “SCH 1367” and adds $1367 to my income.

DianeC958

Level 12

Yes, you do have income if the amount of scholarships your received are greater than the amount you paid for tuition, books and fees to the school.

You are allowed to take additional expenses in figuring your school costs, books, fees, required items for classes. As you input the information for the 1098-T form it asks you about additional expenses you paid for school. If after adding the expenses that qualify the scholarship amount is still more than the school expenses you have taxable income for the scholarship.

Guide to Tax Form 1098-T

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tosontsengelAuthor

Level 2

Maybe the better question is, if I the parent already included the 1098-t and 1098-q on my return then does my dependent child when filing their taxes not need to include either of those forms?

I understand what you wrote, but how does Turbotax know. Turbotax never asks what the cost of school or tuition is. So how can it determine if my scholarship amount is less than or greater than the qualified education expenses? Again, I have found no place in turbotax that asks for what the school is charging for tuition.

DianeC958

Level 12

If the parent is claiming the college student as a dependent then the information for the 1098-T and and 1098-Q is part of the parents tax return. You do not put this information on the student's tax return also.

When you go to the Deductions and Credits Section.>Education>Expenses and Scholarships (form 1098-T) this is where you enter the information in TurboTax. On the 1098-T form it shows the amount that was paid to the school for tuition in Box 1 and in Box 5 it shows the amount received for Scholarships. After this page it asks about other qualifying expenses for school such as books, lab fees and classroom supplies.

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