If you enter it in as scholarship income, it will go through. The Scholarship income would be treated as EARNED income. Follow these steps:
- Open to federal Deductions & Credits
- Locate EDUCATION
- Select Expenses and Scholarships
- Tell the program you don't have a 1098-T, that you have an exception, don't enter any expenses, enter the excess scholarship on the screen that asks if you received a scholarship you have not yet reported.
This will put your income on Sch 1 and Publication 590-A, Contributions to Individual Retirement Arrangements (IRAs) shows this appropriate for your IRA.
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