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February 12, 2021
Question

I received more in scholarships and loans than I had to pay for tuition, where do I add that income?

  • February 12, 2021
  • 1 reply
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1 reply

Hal_Al
Employee
February 12, 2021

Loans are not taxable income. They are borrowed money and you (or your parents if you are their dependent) can claim the tuition credit based on expense paid with loans.

Scholarships that paid for non qualified expenses are taxable. Tuition, fees, books and computers are qualified expenses.  If box 5 of your 1098-T is more than box 1, TurboTax will automatically treat the difference as taxable scholarship income unless you tell it differently.

 

If box  1exceeds box 5 by less than $4000, you may actually want to declare some of your scholarship as taxable to allow you (or your parents) to claim the full tuition credit. For details, see: https://ttlc.intuit.com/community/college-education/discussion/yes-that-is-a-tax-loophole-available-but-you-can-not/01/715052#M19895