The client received a 1098T form with blank in Box 1 and $3750 in Box 5.  The client didn't pay anything when enrolling in classes (Tuition).  I think this is the case because Tuition is free for the first two years at a community college in California.  The client only had some book expenses of $400 dollars.  Here is the question, because there isn't enough expenses related to school (Tuition, Material, etc.) to offset Box 5, would the amount of $3,350 ($3,750 - $400) become taxable for the client?