As clarified above, if there are excess scholarships, grants and/or 529 funds, then all education stuff is reported on the student's tax return. The excess is taxable income to the student. That excess reported on line 21 of your 1040 is also taxed at the parent's tax rate, if their tax bracket is higher than yours.
Also, it's not *if* your parent's claim you either. It's if your parents *qualify* to claim you. Doesn't matter if they claim you or not.
