As @RobertB4444 points out, if you are a dependent, your parents (or whomever supports you) should be claiming you on their return and they could claim an education credit if eligible.
IF YOU ARE ENTERING THE EDUCATION FORMS INTO YOUR TURBOTAX PROGRAM, AND IT IS CALCULATING AN EDUCATION CREDIT, you DID NOT select "Someone else can claim me" and "Someone else will claim me". That is done in the Personal Info Interview.
If you had, the program would not be allocating 10,000 towards a credit.
If the distribution reported on the 1099-Q was used for education purposes, including Room and Board, it needn't be reported nor entered on anyone's return.
If the scholarship received in Box 5 on the 1098-T is less the tuition paid in Box 1, the 1098-T would not be entered on anyone's return (unless it could used towards a credit).
If Box 5 is larger, you need to subtract the scholarship from your tuition, books and fees expenses, and claim the excess as income.
Since you indicate that your parent's income makes them ineligible for an education credit, you would only enter the amount of scholarship income you need to report as earned income.
OR
If you have tax liability (without regard to the 1098-T) and there are more education expenses than scholarship and distributions, you do have an option to claim the "Non-refundable" portion of the American Opportunity Tax Credit. The credit could lower your tax due. To take this option, you select "Yes" to "Someone else can claim me" but "No" to "Someone else will claim me"
In other words, you still file as a dependent, but your parents DO NOT CLAIM YOU on their return.
This allows you to get the non-refundable part of the AOTC, but not the refundable portion.
This is not used often, and if your parents already filed and claimed you, they would need to amend their return and you would need to paper-file.
@dsheamac
See IRS PUB 970
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