Deductions & credits

since box 1 is less than box 2 it looks like its showing up as added income from scholarship. why? we didn't get that money. the school was sent by his employer.

WHy? Because you didn't  indicate YES on the screen that asks if any of the aid received included amounts *NOT* awarded for 2019. Then you enter the amount of the excess that was not refunded to you and continue.

You will need to remember this amount for next year because I do not know if TurboTax will automatically import this into the 2020 tax return or not, next year.