Since they are getting $12k standard deduction, I've seen some say if reported as earned income, they would report it in income section and then take a deduction for the amount paid in education section and treat it differently for reporting, the IRC rules for the scholarship don't necesarrily say where it must be reported and they can get around kiddie tax reporting it as earned income. Also with elimination of exemptions, students scholarship can qualify as their own support and then the student should claim themself. The IRS has not clarified scholarships as support or not nor has the IRC code said where they must be reported and there is leeway in the definition of earned and unearned in all scholarships that could be argued by lack of specifity in the IRC code.
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