Q. It seems incorrect to not enter the 1099-Q at all, but if this is the easiest way to get around being taxed on it incorrectly, then should I do that?
A. Yes. You're too confused to do it the long way. Take the short cut. Don't enter the 1099-Q or any educational expenses. You get the same result, either way. None of the 1099-Q is taxable.
Q. However, wouldn't my son be REQUIRED to enter the 1098-T on his return to at least note his scholarship?
A. No. He is not REQUIRED to enter the 1098-T, But, if he is going to file a tax return, he does need to report the taxable scholarship and entering A 1098-T is the best way to do that. The simple way: enter the 1098-T on his return with box 1 blank and the taxable scholarship amount in box 5.
