1. Something is not right on your return. You have to enter the actual amount or click the box to make the program calculate the numbers. You missed a step.
Scholarships up to the tuition amount can be manipulated to the parents advantage. As the parent, if you qualify to receive AOTC, you can shift things for you to qualify. However, you only get the credit for 4 years and this year was not too exciting. The senior year still counts as undergrad even if grad school the second semester.
The long answer is to first determine if you want to use AOTC this year or wait.
If you are waiting or do not qualify, then tuition, books, supplies minus scholarship equals income to your daughter. If scholarship is less than expenses, nothing to worry about and you may want to claim a different education credit or even AOTC,
The IRS says in Publication 970 (2020), Tax Benefits for Education | IRS: When figuring an education credit or tuition and fees deduction, use only the amounts you paid and are deemed to have paid during the tax year for qualified education expenses.
2. College scholarship is college scholarship regardless of when received.
3. The 1098-T has a box that will be checked if at least half time. The IRS looks at a student for any part of 5 months so the fall semester, Aug- Dec would qualify and allow full time status on the tax return.
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