1098T dependent

CBG31 — Fri, 30 Jan 2026 20:01:21 GMT

Okay so I've tried reading through the answers and can't seem to wrap my head around how to do the numbers on the form. I'm claiming my 20yr old full time student as a dependent on my taxes he has a 1098t form but box 5 exceeds box 1. Box 5 $19680 Box 1 $13263 so that means $6420 of it would be considered taxable and needs to go on his return. But how do I use the "loophole" to be able to claim the tax credit? Like what do I put in my return for 1098t and what does he put in his return for the 1098t, thanks for any help in advance.

Re: 1098T dependent

AmyC — Tue, 03 Feb 2026 19:12:39 GMT

Follow these steps for entry of the loophole:

First, do you qualify for the credit?

For the full credit, your MAGI (modified adjusted gross income) is less than $80,000 ($160,000 if you're filing jointly)
For a reduced credit, your MAGI is between $80,000 and $90,000 ($160,000 and $180,000 if you're filing jointly)
There is no credit given if your MAGI is above $90,000 ($180,000 if you’re filing jointly)

I am assuming that you qualify since you searched for the loophole.

On your return: Enter the 1098-T with $4,000 tuition and zero scholarship to get the program to give the full AOTC credit. If your student is not filing a return, you may need to include on your return the Kiddie Tax.

Student's return:

First, do they need to file? If the total taxable student income (scholarships, 529, work, investments, etc.) reaches $15,750, the student must file a return. You can quickly run through the IRS quiz Do I Need to File a Tax Return? But first, let's figure out the scholarship income.

Since the parent is claiming the education credit:

calculating the scholarship and filing the 1098-T:
- Box 1 will be the remainder of the tuition (after the $4,000 you took out - in your case $13,263 - $4000)
- Box 5 remain the full scholarship amount.
- Enter additional expenses, books, other required expenses.
- The difference between the scholarship and all the other education expenses here is the scholarship income to the student.

If the student is filing a return, they may need to claim the Kiddie Tax on the Student Return.

topic 1098T dependent in Deductions & credits

1098T dependent

Re: 1098T dependent