Q. He's 20 so, if I'm understanding correctly, there is no kiddie tax, right?
A. Yes. There will be no kiddie tax , in your case, because of the amount, not his age. The kiddie tax applies to full time students, under 24, who do not support themselves with earned income.
Q. How do we go about getting the "extra $1116"? Is that a credit my son gets when he amends his return?
A. No. You get it on your form. The simple way to do it is enter the 1098-T (on your taxes) with $2898 in box 1 and box 5 blank. You are allowed to use short cuts.
The alternate (technically correct} way is enter the 1098-T, as is ($2631 in box 1 & $1789 in box 5), enter $267 at books. When asked if any of the scholarship was used for room & board, enter $1789 (that tells TT that he will be making it taxable on his return, R&B are not "qualified" expenses)
Q. Also, where do we report this scholarship on his return?
A. In TurboTax, enter the 1098-T with $0 in box 1 and $1789 in box 5. It goes on Line 8r of Schedule 1.
