Scholarship income is a "hybrid". It is unearned income for most purposes, including the "kiddie tax". But for purposes of a calculating a dependent's standard deduction, it is treated as earned income. This means a student can have as much as $12,200 SCH income and not pay tax, because she gets a $12,200 standard deduction.
If entered properly,in TurboTax (at the 1098-T screen), scholarship income will go on line 1 (wages) of form 1040 with the notation SCH in the margin.
You are correct, she would need to file if her unearned income (other than scholarships) was more than $1100.
