topic Whose form is Taxable scholarships entered on, mine or my dependent student? in Deductions & credits

Whose form is Taxable scholarships entered on, mine or my dependent student?

Surfsidesindy — Thu, 18 Mar 2021 11:31:07 GMT

My student has taxable scholarships this year and received a 1098T. Everything I have read states that the taxable amount should be entered on my students 1040 with SCH next to it. I understand this will be added to her earned income and if her earned income is over the threshold she will pay taxes on the difference. Is there ever a reason where her taxable scholarship income should be added to our 1040 instead (husband and wife filing jointly)? Does the ACA tax credit require her income to be added to ours? Again, my understanding is that if she is under the threshold for filing then her income does not need to be calculated into our MAGI for the ACA credit.

Re: Whose form is Taxable scholarships entered on, mine or my dependent student?

Critter-3 — Thu, 18 Mar 2021 11:56:15 GMT

I understand this will be added to her earned income and if her earned income is over the threshold she will pay taxes on the difference. correct

Is there ever a reason where her taxable scholarship income should be added to our 1040 instead (husband and wife filing jointly)? never

Does the ACA tax credit require her income to be added to ours? if she is required to file a return then yes

Again, my understanding is that if she is under the threshold for filing then her income does not need to be calculated into our MAGI for the ACA credit. again correct ... follow the screen instructions. If she is on your 1095-A form then it must also be listed on her return and the credit must be allocated in any way you choose so don't file either return until you decide who will claim what %

Re: Whose form is Taxable scholarships entered on, mine or my dependent student?

Surfsidesindy — Thu, 18 Mar 2021 14:01:47 GMT

Thank you so much. There seems to much confusion about this issue, even among “experts”. Sorry, but can you explain the last paragraph again. She is covered under our ACA insurance. I am confused by “it must also be listed on her return”. Does that mean she is required to file if she is on the 1095-A? And as our dependent, I wasn’t aware that there is an option for her to claim a percentage of the credit on her return , or am I just misunderstanding the terminology.