Q. So does she use 1973 pell grant total on hers as income or the 901?
A. $901
Q. Is there a particular spot on her return that I put the $901 income?
A. It goes on line 8r of Schedule 1. This spot is new for2022.
Q. Since i am using her 1098t on MY tax return, do I also add it to HER return?
A. Yes, that is the proper way to enter scholarship income and get it to line 8r of Schedule 1. But, you modify it to avoid the "double whammy". Since you have already calculated the taxable amount, enter the 1098-T with 0 in box 1 and $901 in box 5. Don't enter any other numbers.
But, none of that is necessary. Earlier you said "she has zero (other) income". If you dependent had no other income and the taxable amount of her scholarship is less than $12,950, she does not need to file a tax return.
