AOTC Scholarship Issue

[Art]

Client filed MFJ in 2013 and 2024. His son graduated college May 2024. 2024 1098-T Box 1 blank, box 5 $7000. Client paid spring 2024 semester of $8500 in Dec 2023. Nothing paid in calendar 2024 as far as he reported to me. For 2023 1098-T Box 1 $31,000 (this includes $8500 which applied to spring 2024 semester), Box 5 $14,000 box 7 was checked. Client AGI > $200,000 in both 2023and 2024 so no AOTC claimed either year. Do we have a reporting problem for the $7000? Any way to get the $8500 to be taken in 2024 instead of 2023? It was not needed to offset the scholarship payment in 2023. Client just jumped the gun in paying spring 2024 semester in Dec 2023. How to avoid paying tax on the $7000?

Art

[terryats]

Check to see if scholarship could be used for other expenses. Pell grants can be used for other expense other grants may or may not. Each one has to be checked what it can be used for. You have to put the 1098T on students return for 2024.