you are stretching.... do the forms in the instructions and let the math work itself out. He did not pay for his permanent housing at home , the scholarship paid for school housing. Who paid for his health insurance and such, that at home housing allocation and insurance costs are normally high? You want him to be able to claim himself. Did you actually do the return where he didn't claim himself. AOTC or learning credits? If he claims himself you also can not get those, the student does. You said " He really didn't have to pay for anything because his bank account grew by the $8K he had in earned income." logic does not support him claiming himself. But if the math works, go ahead let him claim himself and he also gets the tuition credit then, not you. Then worry about how that impacts state returns. If it's supportable, by all means take it.
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**Mark the post that answers your question by clicking on "Mark as Best Answer" I am NOT an expert and you should confirm with a tax expert.
