@donna136 If your student did not report the Room & Board scholarship as income, on both his federal and state return, then I'm of the opinion that the state is correct in treating it as scholarship applied to tuition and denying you the tuition credit.
Either way, you should contact audit services to handle the appeal. That's what you paid for. Call Tax Resources, Inc. at 877-829-9695, or report your notice on their web site at http://intuit.taxaudit.com/.
