You must subtract out the income. Once you do, you will have a refund of the amount taken.
You can do this once for the w2 and once for the scholarship or you can add them together and enter the total once. I would opt for entering each separately as it allows the dollar amounts and description to flow better. Follow these steps:
- Select Federal
- Select Income & Expenses
- Locate Less Common Income
- Miscellaneous Income, 1099-A, 1099-C
- select START
- scroll to the bottom to Other Reportable Income.
- Select START
- select YES
- Enter description, treaty based exemption
- then a negative of your income amount, use a minus sign in front
- Select Continue
- Description, scholarship offset, w2, or similar
- click Done
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