TurboTax brain trust:
My dependent Kid is in college
Kid has $6194 of 1040 line 11 income on his tax return
Parents don't qualify for any Tax credits/deductions for college tuition due to income
1098-T box 1 shows $54671
$22,000 in scholarship money from college
total of parental 529 withdrawals = 53054 ($22,000 of which is scholarship withdrawal)
22,000 scholarship withdrawal has $13428 basis
QFE= 54671 from 1098-T
Qualified Educational Expenses (QEE) = 54671-22000 = 32671
QEE shortfall = 53054 total 529 withdrawals -32671 = 20383
Kid has 7256 of room left in his 1040 that I could add to his income and have it not be taxed
(13850 std ded -6194 line 11 -400 = 7256)
So of the $22,000 in scholarship income, I should assign to him $7256, leaving $14744 to assign to my tax return?
Also I'm confused should I be assigning gross scholarship 529 withdrawal or the taxable earnings portion? The entire $22,000 amount won't be taxable because it has $13428 of basis.
Thanks!
