So - I have been unable to find a specific answer to this on the forum. My daughter goes to University of Michigan (an accredited school) and attended a study abroad program through that college which was apparently Non-accredited. Here is what I cannot figure out: University of MI sent her a 1098 T showing roughly $40k in grants and scholarships for the entire year (this is normal for her). However, the amount of qualified payment to MI is only $16k instead of the usual $32k, because she only did one semester at the school, while the other was in Spain. The other $16k that normally would have gone to MI was used to pay for the non-accredited school in Spain. It is my understanding that it does not appear I can claim her Spain tuition on my taxes since the school is non-accredited. However, Turbotax also told me that the roughly $16K dollars that was not used at MI would need to be claimed as income - possibly on my daughters return. Try as I might, I can not find any info on how to either mitigate what looks to be thousands in taxes due, or in the worst case scenario - where to claim that money as untaxed income on either my, or my daughters taxes. Its not like there is a 1099 for the loan. I'm trying to figure out the correct way to proceed or document the money..?
