The lifetime learning credit uses $10k to get the full credit. Let's see how much we can get.
Step 1 - scholarships - were they restricted for use in paying tuition or could they be used however you needed.
- If restricted, remove those funds from the eligible scholarships.
- If not restricted, excellent.
Step 2 -How much tuition is in box 1
- If less than $10,000 we want to use it all and make the scholarships go 100% toward room and board.
- If more than 10,000, scholarships can cover the amount over $10,000 and the rest to room and board.
For example: 1098-T box 1 is $15,000, box 5 17,000
Need $10k for LLC
Tuition is $15,000 - 10k for LLC is $5k to be covered by scholarships.
Scholarships are $17k and use $5k on tuition. This leaves $12k to go towards room and board.
You get the full LLC.
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