1098T- Box 5 exceeds box 1

Forum|Forum|1 year ago
January 30, 2025
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Hi! I cannot figure out what to do. I am a full-time college student and I received my 1098T form from my university yesterday. In Box 5 (My total number of scholarships received), the number is around $24,000. In box 1 (Qualified tuition and expenses), the total number is around $10,000. When I input this information when doing my taxes, it considers that $14,000 difference as income. Taxable income. The problem is I did not receive any of that $14,000 as income. In fact, the full $24,000 was applied to my account and it still didn't cover all of my charges(This includes meal plan and room and board). After the full $24,000 was applied to my account, I paid the remaining balance out of pocket. Turbo tax gives me the option to change box 1, and I thought I was supposed to do that. But I am also seeing that I am not supposed to(according to other threads on here). This is confusing to me as they would change my income for the year from $11,000(How much I made from working and is recorded on my W2's) to $25,000 due to the $14,000 difference from my 1098 T. But like I said above I did not receive this money. I did not get any type of refund and had to pay the remaining balance myself. Does anyone know what to do here?

KrisD15

Level 15

If I understand correctly, only 10,000 went to the school and the remaining 14,000 went to other things, like Room and Board.

Funds used to pay for Tuition, Fees, Books and Supplies is tax-free.

Funds used to pay Room and Board are taxable to you.

It is like the 10,000 of the scholarship went to the school to pay tuition.

Then 14,000 WOULD HAVE GONE TO YOU, thus taxable, but rather than go through your hands and back to Campus, the school paid for your room directly.

IRS Pub 970

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Megumi47Author

Level 2

Thanks for responding!

Quick follow up. So the fact I did not receive a refund doesn't matter? With this "Added income" I will now owe money since $14,000 is a lot( And I also worked to pay the rest of my tuition) so I wanted to be sure.

Second follow up so I can understand: I am essentially paying taxes on the scholarships given by my university for room, meal, and other non-qualified expenses even though I am not receiving any of this money personally and it doesn't cover everything.

NateBB

Level 2

@NateBB

You say that the box 5 amount includes 2025 scholarship. You don't say whether the box 1 amour includes 2025 scholarship. You also don't say how much us in box 1.

Q. Shouldn't this taxable reduction in tuition categorized as a Scholarship/Grant for 2025 be declared in 2025 instead of being declared as income in 2024 for my child?

A. Yes. As @KrisD15 said, you will also reach a screen that allows you to adjust the scholarship amount for "amounts not awarded for 2024 expenses". Enter the $6369 there. That takes it out of the picture.

Where exactly can I find this question asking if any of the amounts in 1098-T box 5 are for a different year? I have gone through every screen multiple times and it does not show up.