We received a 1098-T due to our child receiving a scholarship from her university. The total scholarship award was divided into 3 equal distributions that are applied to her account to go toward the cost of her tuition each term. The 1098-T captures two of those distributions, the second of which was applied to her tuition for winter term (academic period beginning January 2025-March 2025).
On the screen where you enter the 1098-T information in TT, there are links to information about what is a qualified education expense. Somewhere in that information, I read something (which I can't seem to get back to now) that said if the scholarship is used to pay for qualified education expenses it would be tax free.
When we enter the information from the 1098-T into TT, it indicated that our child needed to file taxes as the scholarship was taxable to her. This was confusing to me, as I had just read that scholarships money used for qualified education expenses (tuition) is tax free. Can you assist?
