Thank you again for all your patience and guidance. I really appreciate you taking the time to explain the tax rules, exceptions and nuisances to us even though I am sure you have explained them at least 500 times before!
I adjusted our input for both returns as you had explained. I have some additional questions:
1-You mentioned above, “You can claim the full AOTC on your return. For simplicity, enter the 1098-T with $4000 in box 1 and box 5 blank.” I made these changes in our TT but I didn’t change any of the other input screens that followed meaning I still have that $1k was paid for textbooks and $20k was paid for the room and board. Is this correct?
2-Line 17 Used for Credit on our Qualified Elementary and Secondary Tuition smart worksheet shows 0. Is this correct? Shouldn’t this be $4k, considering I entered $4k in eligible expenses in Box 1 of Form 1098T? I also manually changed this number to $4k to see if anything changes and our tax refund did NOT change. What is the purpose of this number anyways?
3-You mentioned above, “On his return, he enters the 1098-T with 0 in box 1 and $33,000 in box 5 ($29,000 + 4000).” I made these changes in my Son’s TT. Should I use $34k in Box 5 instead of $33k? The $34K is made up of $30k taxable scholarship (Form 1098T) plus the $4k. The $29k in my example above was already reduced by the $1k for textbooks and eligible fees. As I mentioned above, I am still including the $1k for books and fees in the input screens for both us and my Son. I want to make sure that I am NOT double-dipping for the $1k for the textbooks since it is in two places.
4-Line 17 Used for Credit on my Son’s Qualified Elementary and Secondary Tuition smart worksheet, is blank (doesn’t even show a 0). Is this correct? The first time I had entered the 1098T information for him a few weeks ago, I had seen an input screen for “Education Expenses Used for a Tax Credit” which said “…if the person who claimed you as a dependent also claimed AOTC for these expenses, then you need to enter $4,000 in the box below in order to calculate education credit.” However, this screen doesn’t show up in his TT, so I cannot enter the $4k in the box. I hope TT is calculating it correctly.
5-Do we need to attach a statement to our tax returns (at least my Son’s return), to clarify why there is additional scholarship income on his Sch 1 that is in excess of what is shown on Form 1098T?
