I'm seeing the message Education Assistance counts as income and should be

Forum|Forum|5 years ago
February 15, 2021
1 reply
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I'm doing my Educational Deductions the way I do every year but this time I'm seeing a message I've never seen before "It Turns Out (insert child's name)'s Education Assistance Counts as Income". How is this possible, her scholarship isn't more than her tuition?

TurboTax Deluxe Online

mglauner

Make sure your 1098-T entry shows the Box 1 amount (Tuition) as larger than the Box 5 amount (Scholarships). If not, the Excess Scholarship is Taxable Income and the 1098-T is entered on the Student's return (if they are required to file a return.

Type '1098t' in the Search area, then click on 'Jump to 1098t'.

At the Education Expenses Summary screen, EDIT your Student (screenshot).

On the next screen, 'Here's your Education Summary', Edit your School (screenshot).

Click this link for more info on How to Enter a 1098-T.

SJabo007Author

Employee

Thanks for the quick reply. Yes, I double checked the Tuition Statement in Turbo Tax (the 1098-T form) and there is an amount of $4,711 in section #1 and the amount in section #5 is $1,000. So I'm not seeing how TurboTax is coming back with this being counted as income when the payment is larger than the scholarship?

Thanks,

Scott

Hal_Al

Employee

Go through the entire education interview until you reach a screen titled "Your Education Expenses Summary". Click edit next to the student's name. That should take you to a screen “Here’s your Education Summary”. Click edit next to the section you want to change; tuition, in your case (click edit next to the school name).

Verify that you entered the box 1 and box 5 amounts correctly.

If that's not it, click the scholarship section and make sure you didn't enter additional scholarships. In particular, loan amount should ne be entered.

If all else fails, click delete next to the student name at the summary screen, and start over