Q. How do I report the money that they refunded me?
A. Enter at Educational Expenses and Scholarships, under Deductions and credits (not the income section). After answering no to having a 1098-T, answer yes to qualifying for an exception (that gets you to the entry screens). You will have to go thru the whole education interview to get to the scholarship screen.
If you do have a 1098-T, a follow up question will be "do you have any scholarships not shown on the 1098-T".
To make some of the scholarship taxable (re-allocate some of the expenses), you tell TT how much you want taxable by saying it was used for room &board. Note the wording at that screen “or other expenses”. You didn’t have to literally use the refunded scholarship for R&B.
Scholarships that pay for qualified educational expenses (QEE - tuition, fees, books and other course materials) is tax free. Scholarship amounts that exceed QEE is taxable income, on the student’s tax return. Room & board are not QEE.
