Thank you for your reply VanessaA. This is still very confusing to me.
It was my understanding that all or some of certain tax-free scholarships could be included in a student's income in order to treat the included amount as paying nonqualified expenses instead of tuition. This would be done in order to increase the student's qualified education expense for the American Opportunity Credit up to $4,000.
You said that my daughter doesn't qualify for the AOC because her scholarship is her only income.
If in my case, I decide to claim my daughter as a dependent as you mentioned, can I claim the American Opportunity Credit (if I'm within the income limit)?
