Q. can we enter $2k, instead of $4k in our box 1?
A. Yes, you can enter any amount, up to $4000
Q. Do we get the full AOTC?
A. No. The AOTC is 100% of the 1st $2000 of qualified educational expenses (QEE). So, $2000 only gets you $2000 AOTC, not the full $2500.
At a minimum, you should use $3075 (34498 - 32350 + 558 + 369 = 3075). But, should still enter $4000, unless his tax rate on the $925 taxable scholarship is 25% or more (unlikely).
