nudgor
Level 1
 
0 Cheers
PhoebeRoberts
Level 11
Level 11

The easy answer is "$15,000 of taxable scholarships and fellowships" in Screen 14.1 of the child's return. Kid is subject to both kiddie tax and AMT.

View solution in original post

0 Cheers
TaxGuyBill
Level 15
The not-so-easy answer depends on this: Would the parents qualify for the American Opportunity Credit if there was tuition paid?  If so, do the scholarships/grants allow that money to be spent on non-tuition expenses (most do, including Pell grants)?

*IF* both of the above are "yes", then you probably want to enter $17,000-$19,000 (an extra $2000-$4000) on the child's return, and $2000-$4000 of tuition on the parents' return.
0 Cheers
PhoebeRoberts
Level 11
Level 11
Agreed. You can also dig around for non-tuition components of QEE to reduce the amount taxable to the kid.
0 Cheers