College aid that exceeds qualified expenses (tuition, fees and books) is taxable income. The "reimbursement" of "leftover" money should be reported as income on our tax return. It goes on line 7 of form 1040 (or 1040A) with the notation SCH.
In TurboTax, you enter at educational expenses. Usually the difference between box 5 and box 1 (or box 2) of your form 1098-T is the taxable amount and you do not need to enter anything other than the 1098-T. If the 1098-T does not accurately show the taxable amount, you will reach another screen in the education interview to enter additional scholarship amounts.
