Prepaid Tuition/Taxable Scholarships/AOTC question

mommdc
Thu, 31 Jan 2019 16:20:13 +0000

TurboTax interview should cover it all. There is a worksheet for AOTC somewhere too.

Add up all QEE (tuition fees books) on a piece of paper.

Then subtract prepaid tuition plan since it has to be used for tuition.

Is there anything left? That is adjusted QEE. AQEE

That you can claim towards AOTC.

All other scholarships can be declared for non QEE and made taxable, if the scholarship allows that.

I think TurboTax also asks about prepaid tuition plans and such.

Try entering the 1098T and then declare all scholarships received to be paying for room and board (as part of entering 1098T info).

If he had $4377 in tuition fees and $391 for books (it asks that in TT), then he would have $4768 in QEE.

Subtract the prepaid tuition from that and that will be $1,184. That is adjusted QEE.
And you should be able to claim that for AOTC.

Then your son will claim all other s scholarships on his tax return as taxable.

Not a tax professional, just a mom doing our own taxes.

Your situation is like ours since tuition is covered by the prepaid plan and has to be used for that. My D got a scholarship for tuition. So we only ever used to claim books and fees for AOTC and she would claim other grant and scholarship as taxable income on her taxes.