My daughter went away to college at UNM this year. She is 19 (Freshman) and received a scholarship. We received a 1098-T for her from the school.
Box 1: 4679.06
Box 5: 6929.06
Box 8: Checked
She is going for her Bachelors Degree. I understand they paid her more (box 5) than what she used for school (Box 1) and entered that on my 1040 in the 1098 section for Education and assigned it to her.
She had housing expenses that we paid (we didn't explicitly use the 2250 extra to pay them as we used other money due to the scholarship money coming in later than we needed).
I get the notice that the Education Assistance counts as income and it says "That's because scholarships and other education assistance are considered taxable income. If they exceed the education epxenses. If the money was used to pay for "nonqualified expenses, or if she was not enrolled in a degree, certificate or credential program at an eligible school. She will need to file a tax return to include the 2250 amount taxable income.
So question 1: The statement " was not enrolled in a degree, certificate or credential program at an eligible school" is odd to me since she is enrolled going for a bachelors degree.
Question 2: I saw in other (older) posts that if her income is less than 6100 then she doesn't need to file a return. Her only other income is interest on her education CD that she is using to pay for school and that was only 40 something dollars.
We claim her on our taxes so I think I have a handle on that but not sure if she really needs to file a return or not since she didn't have any other income.
