My 15 yo took a class for college credit and received a 1098-T with Box 2 & 5 completed. TurboTax says he must file a return. Do I need to file a separate return for him?

[AndrewK]

My 15 year old son took a class for college credit through his high school.

The college provided a 1098-T form with Box 2 and Box 5 completed (tuition and same dollar amount - $660 - for the scholarship/grant). The amount in box 5 was used entirely for tuition.

When completing this in TurboTax, the program states he must file a return on his own as this is taxable income. He has no earned income (only interest from a savings account at the credit union).

I’ve seen conflicting messages that this is and is not taxable. Any feedback – do I need to file a separate return for him?

[Vanessa · Accepted solution]

Since the amount was only $660 this is under the filing threshold so he would not need to file even if it was more than his qualified educational expenses if he has no other income to report.  In general, a scholarship can be taxable if it is more than the qualified educational expenses.

If you are getting this message you may want to go back and double check your entries.  Sometimes this is just an FYI just in case standard message (depending on which screen you are seeing it on), other times it indicates that you may have entered a scholarship amount greater than the tuition amount.