How do you enter FAFSA Pell Grant money received in order to calculate the taxable portion that was not used for education expenses?

How do you enter within TurboTax the FAFSA Pell Grant money received in order to calculate the taxable portion that was not used for education expenses?  Within my first entry I saw options in the Educational Expenses Section but entered ONLY books & computer expense - I entered nothing under Scholarships or anything else.  I believe there is a calculated amount leftover (i.e. kept and not used for educational expenses) from the total FAFSA Pell Grant received which probably needs to be entered somewhere. I expect this will lower our return amount.

Based on articles I read the portion of FAFSA Pell Grant money received BUTnot used for any education expenses is considered taxable.  My wife receives Education Leave from her job so that she can attend college as a full-time student in pursuit of a degree.  She returns to her job during the summer and winter breaks.  For what it's worth, she does not receive income from her job while attending college.

In related online articles I read the following:
The Pell Grant Can be a pre-requisite for qualification of other types of Educational Financial Assistance
    If you have qualified for educational financial assistance under the federal Pell Grant, you might also qualify for additional assistance under the Federal Workstudy Program, or the Federal Supplemental Equal Opportunity Grant.

Is The Pell Grant Taxable?
    As long as the Pell Grant has been used for your educational expenses and other expenses related to your education, the grant isn't taxable income.

Read more: Are Pell Grants Taxable? |


Any scholarships and grants in excess of expenses are considered income.  Usually this is taken care of by entering your 1098T.  Box 2 is tuition and fees, and box 5 is scholarships and grants.  If you have expenses that don't show up on your 1098T (like books), report them in TurboTax as "Additional Expenses" in the screen that follows the entry of the 1098T.  Those expenses will reduce the 'income" from excess scholarships dollar-for-dollar.

Also, education leave that does not result in any income is not taxable.  (Essentially your employer is nice and giving you the time to go to school.)
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