how do you claim part of a scholarship as additional income

[dreamlessnite]

My child received 12000 in scholarships. It says 10,000 was paid as expenses. In my taxes if I say she claimed 4000 as additional income, I qualify for the AOTC. WHICH over 4000 was for room and board. I can't figure out where in her taxes to enter it as additional income. If I enter her 1098T it just says she doesn't qualify, there is nowhere that asks if any was for room and board.

[KrisD15]

12,000 scholarship and 10,000 expenses leaves 2,000 the student must claim. 

The student can claim more so that you can get an education credit.

The American Opportunity Tax Credit can be as much as 100% of the first 2,000 and 25% of the next 2,000, so it maxes out with 4,000 expense claimed. 

If you are only claiming 2,000 for the credit, YOUR student claims 4,000

If you are claiming 4,000 for the credit, YOUR student claims 6,000

(since the student needs to claim 2,000 without you claiming a credit)

(If that is the only income the student has, the income would be under the filing requirement for a dependent and  the student would not need to file a federal tax return.)

If the student does need to file-

On the student's return go to:

• Deductions & Credits 
• Education
• Expenses and Scholarships    START or UPDATE

Enter the student info if needed or select the proper question concerning the student, such as degree, Full/half-time

Once you get to the screen asking for the school name, continue without entering any data 

You will get to a screen that asks "Did You Receive a Scholarship or Grant in 2024?" 

select "YES" 

Enter the amount you wish the student to claim 

Continue through to finish the section.

The amount will be on Schedule 1 line 8r

It may or may not be taxable depending on the student's other income