It appears a ROTC scholarship for tuition and fees excludes the ability to take the $2500 lifetime learning credit for qualified tuition expense. This even though the total cost of college is at least $10,000 more than the ROTC covers. I saw in the IRS pub 970 an example where a person allocated their scholarship to room&board, and then was able to say they paid the tuition so it qualified for a deduction. Can this be done with a straight face for the ROTC scholarship?
Further, considering that the Navy wants 4-8 years of my sons hide for this "scholarship" it would seem to be different than most others; more like prepaid wages.
Any way to take the $2500 credit?
Is anyone aware of potential rulings on this one? The ROTC bargain is marginal enough as it is but by now the scholarship is effectively reduced by $10k over 4 years.
Further, considering that the Navy wants 4-8 years of my sons hide for this "scholarship" it would seem to be different than most others; more like prepaid wages.
Any way to take the $2500 credit?
Is anyone aware of potential rulings on this one? The ROTC bargain is marginal enough as it is but by now the scholarship is effectively reduced by $10k over 4 years.