Q. So no matter what he has to pay $1500 in taxes on something he got for school?
A. Yes.
Q. But is there a way to make it so he qualifies for AOC?
A. No. For two reasons: 1. As the other reply already said, all the qualified expenses were covered by tax free scholarship* and 2. The AOC law was written in such a way, that only the parents (usually) qualify for. Full time student under 24, are (usually) not eligible.
As mentioned at your other post, there is loop hole available where the parents can claim the AOC, on their return, if the student declares even more of his scholarship as taxable. You can not do that if the scholarship is restricted to paying tuition & other QEE. I'm not familiar with "Go Blue Guarantee" . But a cursory online look seems to say it may be so restricted.
*Scholarships that pay for qualified educational expenses (QEE - tuition, fees, books and other course materials) are tax free. Scholarship amounts that exceed QEE is taxable income, on the student’s tax return. Room and board and other personal expenses (e.g. transportation) are not QEE.
