We live in WA. work in OR. Our son received a scholarship in CA we reported on our federal taxes. There is no box to show that $0 of that scholarship applies to Oregon.

[mukobi]

We live in WA state and my husband works in Oregon and therefore we must file an Oregon Nonresident return. When transferring data to our OR-40-N, we can allocate how much of our earnings applied to Oregon (instead of Washington). However, I can't see a place to adjust my son's college scholarship from a California university that we reported on our federal taxes that does not apply to Oregon (since we live in WA and he goes to school in CA, none of the income should apply to Oregon since we are nonresidents). Where can I make that adjustment? 

[Anita01 · Accepted solution]

Assuming you are claiming your son as a dependent and taking education credits for him.  You do not claim any taxable part of his scholarship on your return.  It would be reported on his return, if he has enough income to have to file.  If not, no one woud report it.  You would only claim the nontaxable portion of the scholarship you used for his eligible education expenses, in the 1098-T section.

[mukobi]

Thank you for your reply. TurboTax prompted me to enter the entire 1098-T for our federal return which, in turn, affected our Oregon return. However, none of that scholarship (taxable or nontaxable) should be included on our Oregon return since we don't live there. How can I take it out of our Oregon return while leaving it in our federal return? Thanks in advance for your answer.