So I filled my taxes with a person this year due to a bunch of papers that I never had before and when it got to the school portion, they entered the amount in block 5 which included the amount from the VA and when they deducted the VA Amount the rest was considered taxable income. I am curious because when the tuition came through, the FAFSA paid whatever amount it could and then the VA Paid the amount (full tuition amount) after and whatever was left over I got refunded but when the tax prep entered it, it was all listed as taxable income so it kind of boned me in the end. Is there a way to show that the refund came from the VA portion and thus becomes tax free?
