I am going to assume you are saying that box 1 is for fall only and box 5 is fall and spring. The program allows you to reduce the box 5 scholarship for just the fall. You have to remember to adjust it back up next year to compensate.
The next issue is to determine if you qualify for a college credit.
- See if you qualify, What You Need to Know about AOTC and LLC.
- If you qualify, you want to claim that $4,000 of the tuition was paid by you.
- That leaves $30,000 to be covered by scholarships.
- The IRS has a great brochure that explains how scholarships and tax credits interact.
- Your student will claim the scholarship income not used towards that $30k. This may not even be taxable to the student while you get a nice break.
Student loans are not part of credit calculation. If you have paid interest, that is entered under student loan interest.
If you mean box 1 and box 5 contain fall and spring, that is fine and nothing needs to be adjusted.
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