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@MGC94 wrote:

box 1 tuition is $15,600

box 5 scholarship $20,369.50

Hypothetically let's say she was able to be a dependent. Are you saying you can put box 5 on the taxpayers return and box 1 on the parents return?  

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If the 'child' was a dependent and the parent claimed her ...

Right now, the 'child' has $4769.50 of taxable income and the parent has $0 of tuition for an educational credit.

*IF* the scholarships/grants are allowed to be used for non-tuition (such as a Pell grant), then the child could elect to have more taxable on her return.  The child could have $8769.50 taxable on their tax return, which would give $4000 of tuition for the parents to claim an educational credit.  However, depending on if the 'child' has other income, the Kiddie Tax could kick in.  When that happens, sometimes it would yield the best overall result if the 'child' only claims an extra $2000 (rather than $4000).

See "Coordination with Pell grants and other scholarships" in Publication 970.

https://www.irs.gov/publications/p970#en_US_2022_publink100060350