I have a client whose AGI is $195,000 plus. His daughter (dependent) is enrolled in college and received a 1098-T which reports $18,942 received and reporting $9,000 in scholarships. The spouse is the recipient of a 1099-Q with the daughter as beneficiary. The 1099-Q reports Gross Distributions of $32,504, Earnings of $15,461 and basis of $17,042. With a State Distribution. When all information is entered into system, the final result is because of the high AGI the 1098-T is phased out so that not education credits appear. while the 1099-Q reports the earnings as income. I have never in 20+ years of doing taxes have I run into such a problem. It seems to me if there is a1098-T involved that the 1099-Q does not kick in. Someone please set me straight so I can finish the return.