I'm a parent of a 19-year-old full-time college student. He is:
Enrolled full time student (sophomore).
We provide 100% support.We are married, filing joint. Our AGI is in the limit to claim the American Opportunity Credit. We claimed the American Opportunity credit for him last year.
He lives with us 12 months of the year.
He received a 1099-nec for $750. No taxes deducted
He received a 1098 T that indicated that he got more scholarships than qualified educational expenses: Box 1 = $14,147 Box 5: $28,962. Scholarships are only used for tuition and cannot be used for room and board.
We paid out of pocket qualified educational expenses of $1,013 (books,computer,etc).
We are uncertain who should report the income, how to minimize tax for both of us and how best to maximize education expenses/ credits (ie. American opportunity tax credit). Can we claim him as a dependent? We would appreciate clarification and how to handle this in turbo tax.
- Is my son (or the parents) responsible for reporting the excess scholarships ($28,962- $14,147=$14,815) ? Who would report the $750 stipend? To report the excess scholarships, would they simply enter the 1098 T information on their return?
- Can the (parents) claim the out of pocket expenses ($1,013) and claim a portion of the American opportunity credit?
- We provide 100% support to our son. Can we still claim him as dependent,even if he reports the income?
- On Form 8615, there is a question..” if the parent elects to report income on their return”.. Would we need to check this box or not? What is the result if this box is checked?
Thanks for your help!
