Box 14 on a W2 does not report tax information, it is used by the company and their payroll department.
An employer may gift education assistance up to 5,250 with it being tax free to the student. That's why it's in Box 14, it should have no affect on the student's tax return.
IF you are reporting any education expenses for the student ( in order to apply for an education credit ), you must subtract the amount of the assistance from the expenses paid. TurboTax will ask for this information when you proceed through the education section interview to enter the additional expenses.
If the education assistance is listed on the W2 in Box 14, and no other education expenses were paid, (therefore you are not reporting any additional costs on your tax return) you may simply enter the W2 and move forward. If tax was withheld on that amount, that tax will be included in Box 2 which IS tax information the program uses. The student's tax should be computed on the amount in Box 1, not including the amount in Box 14, thereby leaving the amount in Box 14 tax-free.
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