Education dual-enrollment

Forum|Forum|4 years ago
March 29, 2022
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My high-school son was dual-enrolled at the local community college, and the classes were paid for by a state grant. His 1098-T states that the payment received for qualified tuition (Box 1) is greater than the grant amount (Box 5). TurboTax tells me that he has to file his own tax return, even though we (his parents) have claimed him as a dependent and entered the 1098-T information already on our taxes. Why then does he have to file his own tax return?

TurboTax Free Edition Online

MAK70

Do you mean that the grant amount is more than the tuition? Even though you are claiming him as a dependent, if there is scholarship income, it must be reported on his tax return. (What is the amount of he excess, it may be under the filing threshold. The minimum income requiring a dependent to file a federal tax return. 2021 filing requirements for dependents under 65: Earned income of at least $12,550, unearned income (like from investments or trusts) of at least $1,100, or self-employment income over $400.)

If you receive a scholarship, a fellowship grant, or other grant, all or part of the amounts you receive may be tax-free. Scholarships, fellowship grants, and other grants are tax-free if you meet the following conditions:

You're a candidate for a degree at an educational institution that maintains a regular faculty and curriculum and normally has a regularly enrolled body of students in attendance at the place where it carries on its educational activities; and
The amounts you receive are used to pay for tuition and fees required for enrollment or attendance at the educational institution, or for fees, books, supplies, and equipment required for courses at the educational institution.

You must include in gross income any amounts used for incidental expenses, such as room and board, travel, and optional equipment.