Yes, you can choose to make the scholarship taxable. Yes, it is included on Line 7 and counts as Earned Income for purposes of the Standard Deduction.
No, it is NOT count as paying your own support. As we discussed above, the Tax Code SPECIFICALLY says it does not count. No, it would not avoid Kiddie Tax. The Tax Code is very SPECIFIC what qualifies as Earned Income for purposes of the Kiddie Tax, and scholarships are not part of that. So scholarships are subject to Kiddie Tax, regardless if you treat them as taxable or not.
