The question is asking about Box 5 on a 1098-T.
Box 5 on a 1098-T is reported by the school. It is the amount the school received as financial aid given on behalf of the student to be applied to the student's education expenses.
Education credits and possible taxable income (for the student) are calculated on numbers entered from Form 1098-T, but some of the numbers can misleading. Credits and taxes are computed on the calendar year. School years often cross calendar years. Schools often bill in December of one year and a scholarship (to cover those costs) might not post until January the next year.
Form 1098-T does not tell the TurboTax program everything it needs to know to make the proper calculation.
MOST scholarships go directly to the school and are in Box 5 on Form 1098-T.
Some scholarships are given to the student directly and not listed in Box 5.
Still others might go to the school, be in Box 5, AND ALSO listed as income on some other tax form, such as a W-2 or 1099.
The question you're asking about has to do with this last situation
"Still others might go to the school, be in Box 5 AND ALSO listed as income on some other tax form."
Did the student get "Employer Education Assistance or Reimbursement" which which was included on the student's W-2, or a scholarship that an organization issue a 1099-MISC for that amount to the student?
The program does not want you (or the student) to report any scholarship twice.
This is asking about scholarships, not gifts, and only if the same amount was double-entered (so also on an additional tax form).
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