You don't need to make the calculation yourself. Just enter form 1098-T in TurboTax and if box 5 exceeds box 1, the difference will be treated as taxable income.
If you're getting a degree at an eligible school, your scholarship is tax-free when used for:
- Tuition and fees
- Fees, books, supplies or equipment required for your courses
- Any scholarship or fellowship for services received under the National Health Services Corps Scholarship Program or the Armed Forces Health Professions Scholarship and Financial Assistance Program
Why is my scholarship taxable?
To enter form 1098-T:
- Go to Federal Taxes,
- Go to Deductions and Credits.
- Scroll down to Education and click show more.
- Scroll down to Expenses and Scholarships (Form 1098-T)
- Answer Yes for the question if you received a 1098-T.
- On the following screen choose the student.
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