1. Yes. If you decide that you do qualify and the return to you is greater than the cost to her, she would claim whatever scholarship income is necessary through the education section. The AOTC only requires $4,000 for the full credit. The LLC requires more income for a smaller gain, 20% of the expenses will become the credit.
2. Yes, as your dependent she can claim the expenses you paid to reduce her scholarship income.
3. Yes, if you claim no expenses on your return, her scholarship income will be reduced by tuition, books, and any other qualified expenses.
4. The desktop/ download program can be used for 5 returns. See how to download your software here.
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