Deductions & credits

@Sgiraldo2025 still may not work - it depends.  

 

Example: 

 

QEE = $10,000

Scholarships = $29,000 ($8,000 are restricted, $21,000 are unrestricted).  The Pell grant is part of the $21,000.

 

you must net the QEE against the Restricted scholarships FIRST. 

 

In that case, The $8,000 of restricted scholarships are netted against the $10,000 of QEE.   

 

What remains is $2000 of QEE and $21,000 of unrestricted scholarships.  Since there is only $2,000 of QEE remaining, that is the only expense eligible for AOTC.  The fact that there is $4,000 of Pell is immaterial. 

 

The key to your strategy is to determine how much of the scholarships are restricted versus unrestricted.  Just having $4,000 of Pell grants is NOT the right criteria.