topic 1098-T Box showing up as 1040 Box 1 income...why? in Education

1098-T Box showing up as 1040 Box 1 income...why?

Sagnest — Fri, 03 Apr 2020 00:10:22 GMT

My daughter (filing single and not as our dependent) got a 1098-T form in 2018 and 2019 (which showed how much tuition she paid and how much she received in grants) . In both cases, Box 1 (tuition she paid) exceeded Box 5 (grant money).

In 2018's 1040 tax return, Box 5 amount on 1098-T was not included under wage, salaries income (box 1 of 1040 form) but in 2019, it was! Why? How do I fix that because the support form on TurboTax is filled out the same was as last year's return.

Re: 1098-T Box showing up as 1040 Box 1 income...why?

NCperson — Fri, 03 Apr 2020 16:10:17 GMT

suggest going back and checking all of the inputs...... if Box 5 exceeds Box 1 then the net should show up as income on Line 1 of form 1040. if it's the other way around it shouldn't,

are you saying that BOX 5 is the amount that is showing up on Line 1 / Form 1040?????

Re: 1098-T Box showing up as 1040 Box 1 income...why?

JotikaT2 — Fri, 03 Apr 2020 20:23:49 GMT

It depends.

Scholarships are taxable if used for the following items:

Room & board
Travel & incidental expenses
Any fees, books & supplies not required for classes

Scholarships are not taxable if used at an eligible school for a degree if:

Tuition & fees
Fees, books, supplies needed for classes
Scholarship or fellowship for services from:
- National Health Services Corps Scholarship Program
- Armed Forces Health Professions Scholarship & Financial Assistance program

You can check your input and make any allocations by doing the following:

Go to the Federal interview section.

Select "Deductions & Credits"
Select "Expenses and Scholarships (Form 1098-T)" and click start/edit
When you see Your Education Expenses Summary, select Edit to the right of your name.  You will see the following screen:

Select Edit to the right of Scholarships/Grants (for all schools).

You will be able to allocate the amount of the scholarships used or not used for room and board as you go through the screens. It should look similar to the picture below.

Re: 1098-T Box showing up as 1040 Box 1 income...why?

NCperson — Fri, 03 Apr 2020 20:34:10 GMT

@JotikaT2 - i appreciate the time you took to provide your detailed post... however, under the assumption that the school completed the 1098T correctly,

This is what should already be in Box 1:

Tuition & fees
Fees, books, supplies needed for classes
Scholarship or fellowship for services from:
- National Health Services Corps Scholarship Program
- Armed Forces Health Professions Scholarship & Financial Assistance program

This is what should already be in Box 5:

scholarships

These items are already not represented in either Box 1 or box 5 (and shouldn't be represented)

Room & board
Travel & incidental expenses
Any fees, books & supplies not required for classes

As long as @Sagnest punched in the 1098T correctly, the error should be elsewhere. Did you by chance indicate that your child CAN BE your dependent? that could be the source of the error.

Re: 1098-T Box showing up as 1040 Box 1 income...why?

Hal_Al — Sat, 04 Apr 2020 01:27:33 GMT

If Box 1 (tuition ) exceeded Box 5 (scholarship), you are correct there should not be SCH income on line 1 of form 1040. There is an entry error, somewhere. She may even be able to claim a tuition credit.

But, why is your daughter not your dependent?