1098-T Excess Scholarship Income goes on taxpayer's or dependent's 1040?

[NPChristy]

Student is Mom's dependent. The Student's 1098-T has $5K in excess scholarship income (Box 5 is greater than Box 1). The program is not pulling that excess amount from the student's tuition worksheet (part V, line 9) into the mom's income (W-2 SCH).  I'm assuming I have to put the $5K excess income on the student's tax return, even though she's a dependent?

[Frustrated-in-IL · Accepted solution]

Goes on the student's return.

Enter 1098-T on student's return as you did on mom's return.  Since the dependent box on the student's return will be checked, the program will tell you the student does not qualify for AOTC or Lifetime Learning or that net qualified expenses are zero.  That isn't important.  What is important is that the program will compute the excess from the entries you made and include the taxable amount on Line 1 of the student 1040 with the code "SCH" and the taxable amount shown to the left.

[athaureaux6]

Hi, the program is working fine. The excess will go in the student's return if the students files one. It is not supposed to go on the mom's return. Have a great day everybody . 

[dascpa]

Be careful.  When the student has it on their return as previously reported the software thinks it's earned income.  It is not and it could affect the kiddie tax.

[NPChristy]

Thanks! I thought it should go on the student's return.  That makes sense to put the 1098T info on the student's return so that the income flows correctly with the SCH code.