I think you are saying somehow the software prompts me for a dollar amount to which I put in 10 thousand dollars. And it then increases her taxable income by $10000. Yet at the same time, that qualifies her for an additional $2000 Lifetime learning credit.
It seems odd and feels weird but if she is entitled to it and I guess I should do it.
Now, when I do my PA state tax must this also be considered taxable income there. Or can I rather say that she had 15K and education expenses? And I used her 529 plan to pay those expenses thus there's no taxable income for pennsylvania state.... Does that make sense?
